Default fund capital will halve under final rule, banks say

Clearing members welcome Basel's fifth – and final – version of charge

Ulrich Karl, HSBC

It has taken nearly four years, 82 comment letters, five different calculations, and a lot of handwringing and fretting, but the Basel Committee on Banking Supervision has finally produced a capital regime for exposures to central counterparty (CCP) default funds that banks believe will allow them to run the clearing business sustainably.

Dealers claim each of the previous four methods would have discouraged the trading of cleared over-the-counter derivatives, conflicting with a key pillar of

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