CVA desks could struggle with Volcker correlation tests

Banks turn to lawyers for advice as CVA functions face tougher conditions than other trading desks

Volatility arrows2

The Volcker rule's treatment of hedging will increase the workload for credit valuation adjustment (CVA) desks and, in a worst-case scenario, could prevent them from putting in place capital-mitigating trades, dealers fear.

Some banks are now consulting in-house lawyers on what the long-awaited rule, published on December 10, means for the desks. The head of CVA trading at one large European bank with operations in the US says the regime looks like trouble, but adds: "The lawyers need to dig

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 or view our subscription options here:

You are currently unable to copy this content. Please contact to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to View our subscription options


Want to know what’s included in our free membership? Click here

This address will be used to create your account

You need to sign in to use this feature. If you don’t have a account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here