Electricity-backed security: concepts and measures

John Jiang and Hanjie Chen propose a generic concept ofelectricity-backed security, which provides an additionalfunding method to utilities with poorer credit ratings,and a new asset class to investors

We show that, as an industry-wide issue, credit rating ofelectric power companies has been decreasing since the outsetof electricity restructuring. This article proposes electricitybacked security (EBS) as a novel approach to help powercompanies with less desirable credit ratings to access lowcostcapital. Electricity-backed securitisation is the processwhere future receivables from long-term electricity contractsare exchanged for their present value. In the electric powerindustry, the existence

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Stemming the tide of rising FX settlement risk

As the trading of emerging markets currencies gathers pace and broader uncertainty sweeps across financial markets, CLS is exploring alternative services designed to mitigate settlement risk for the FX market

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