End-users say non-cleared margin rules will hit hedging

Dramatic increase in margin on uncleared swaps will reduce end-user hedging ability, says US insurer

BIS headquarters, home of the Basel Committee

Bilateral margin rules for non-cleared over-the-counter derivatives are designed “to make the world safe for banks, but not safe from banks," according to Bruce Fox, the head of derivatives at US insurer Genworth Financial.

During a panel discussion at Risk's OTC Derivatives Clearing Summit in New York, Fox said the new rules – which have been agreed internationally and are being transposed into national regulations – will compel all market participants to post more collateral than in the past

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