Bank of England softens tone on CCP cross-product margining
Breeden supports margin efficiencies to encourage more repo clearing, but still warns on leverage
A senior Bank of England official has signalled an easing of the regulator’s previously tough stance on cross-product margining by clearing houses, in a bid to support greater central clearing of gilt repo in UK markets.
“Greater central clearing can unlock balance sheet capacity, lowering the cost of intermediating gilt repo,” said Sarah Breeden, deputy governor for financial stability at the BoE
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