
Varying bank leverage ratio could fix ‘broken’ repo market
Risk Live: Repo with buy side should incur different leverage ratio, suggests big asset manager

The repo market is “broken” but there is a way for regulators to fix it: by applying different leverage ratio requirements to banks depending on the counterparty to the trade, according to the head of trading at HSBC Global Asset Management.
“When the leverage ratio applies…it should apply differently for the interbank market and for banks [trading] with end-customers,” said Daniel Leon, global head of trading, treasury management and global solutions at the $517 billion asset manager.
“What
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe
You are currently unable to print this content. Please contact info@risk.net to find out more.
You are currently unable to copy this content. Please contact info@risk.net to find out more.
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Printing this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@risk.net
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Copying this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@risk.net
More on Investing
HKMA launches consultation on green taxonomy
Regulator could use proposal to assess progress of banks towards climate goals
Taking stock: putting a price on US bank regulation post-SVB
Tougher requirements could “blow a hole” of 200+bp in regulatory capital ratios – and cripple equity returns
A student of Dr Doom says QE is here to stay
Salomon alumni Michael Howell says central banks can’t stop pumping liquidity
In bank runs and market crashes, it matters how ideas ‘catch’
Contagion episodes show importance of network effects in finance
HFT activity increases periodic auctions costs
Eightfold jump in market impact as more trades head to once-benign execution format
We’ll help banks reach ‘other side’ of deposit squeeze – Ares CEO
Private credit firm talking with banks about liquidity and capital ‘solutions’
Zero-day spikes vanish as bank worries exceed inflation fears
Implied volatility for short-dated options points to shift in sentiment after SVB failure
More data needed on ‘cocktail’ of private market risks – FCA chair
“Patchy” reporting makes spotting hidden leverage and liquidity risk hard, says Alder