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Concerns roil prop clearing waters in wake of ABN losses
State-backed lender insists few clients have defected – but sharks circle, post-Parplus
EU’s Brexit clearing grab slow to lift off
Clearing members say clients aren’t transferring material volumes from LCH to Eurex rapidly
Top clearing houses bolstered default funds over Q1
NSCC reported its guaranty resources grew 231%
Latest
Quotes
An organisation might have [the expectation that] X% of people are in the office 9am-5pm, [and that their activity] would come from trusted internet protocols, and so forth. Post-Covid, all bets are off. There are people working extended hours – maybe into the night. They are not coming from trusted IPs.
The forcible shift to remote working has made it far more difficult for bank cyber surveillance teams to monitor data for suspicious or unusual activity, says Rowland Johnson, director at CREST.
One-day MPOR is questionable. In Europe, [the regulatory] minimum [is] two days – but in some other parts of the world, one day is fine, and some CCPs are applying that. But I think we learnt from the coronavirus crisis that one day is too short to liquidate.
Eurex’s CRO says coronavirus-induced margin breaches show the dangers of CCPs assuming they can close out a defaulter’s portfolio inside a day.
If a client feels they’ve had a bad outcome, a legal case is one of the remedies they would seek.
A senior op risk professional, who oversees the compliance aspects of a bank’s Libor transition programme, says the risk of Libor lawsuits is worrying lenders across the market.
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Big Figure
Continental drift
A survey of more than 300 Risk.net readers, carried out in late March, highlights the starkly different realities that respondents in different parts of the globe expect to be living with while the pandemic lasts. Asked how many weeks it would be until the majority of schools, businesses and other places of work are “functioning normally” in their own region, expectations were wildly different. And viewed regionally, a clear split on lockdown expectations emerges between respondents in the US and Europe versus those in Asia-Pacific and the rest of the world.
Read the full article7 days in 60 seconds
Covid capital, SA-CCR and problems with post-Libor protocol
The week on Risk.net, July 4-10, 2020
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Comment
Regulatory lenience over Covid-19 must be carefully judged
‘Ostrich approach’ to financial stability is a mistake
Our Take
Don’t let a good crisis go to waste
Time for the standardised approaches to shine