Cherry-picking fears as banks pull negative rates commitments
As UK mulls negative rates, banks desert Isda protocol and traders warn of gaming the system
As negative UK rates look more likely, a number of banks have pulled out of an industry commitment to make payments on collateral posted to cover mark-to-market derivatives losses in a negative rates environment – amid growing concerns about cherry-picking these payments.
Risk.net has learned that Citi, Commerzbank, Deutsche Bank, JP Morgan and Royal Bank of Canada have all revoked their adherence to an industry protocol – managed by the International Swaps and Derivatives Association – which
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