Dealers warn of trouble ahead as Treasury issuance swells
Repeat of February’s ‘Black Thursday’ likely if Fed ends leverage ratio exemptions, banks say
The foundation of the global financial system is showing some cracks.
On February 25, US Treasuries suffered a bout of extreme turmoil and illiquidity that took many by surprise and hinted at fragility in a market on which all others depend. Bond dealers say further tremors are inevitable – unless, at a minimum, regulators tackle a known side-effect of post-crisis rules.
The rule in question is the supplementary leverage ratio (SLR). By constraining the growth of banks’ balance sheets, it
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 Markets
Turbocharging tech for next-level risk analytics
As regulatory demands and market conditions constantly change, investing in robust risk analytics is becoming not only a business necessity, but an essential compliance requirement
Pimco’s cuts to FX forwards positions hit dealers in Q4
Counterparty Radar: State Street takes top spot among dealers as BNP Paribas slides to fourth
New trading platform costs weigh on FX dealers
As roughly 75 platforms vie for business, LPs complain of struggle to keep up with connectivity costs
Mizuho’s life insurance swaptions notional climbs 575% in a year
Counterparty Radar: Prudential, Global Atlantic add substantially to positions in Q3 as market’s notional total grows to $184bn
Why ‘Derivatives’ became ‘Markets’
The derivatives markets have changed drastically over the past decade. So has Risk.net’s coverage
Corporates eye FX options as hedging costs shrink
With hedge ratios tipped to rise, dealers say treasurers are increasingly open to optionality
Citi swaption volumes surge as BlackRock relationship flourishes
Counterparty Radar: Market leader Pimco cuts nearly one-third of book in Q3
Pimco’s interest rate swaps book shrinks 21% in Q3
Counterparty Radar: BlackRock and Capital Group also trim positions to drive down swaps usage by US mutual funds
Most read
- Top 10 operational risks for 2024
- The American way: a stress-test substitute for Basel’s IRRBB?
- Filling gaps in market data with optimal transport