Standard stress tests could create more risk, CCPs warn
CPMI and Iosco aim to develop a standard stress test for CCPs, but market participants say the devil will be in the detail
Standardised stress testing of clearing houses – while attractive in principle – may drive risk management standards to the lowest common denominator and make the financial system riskier, clearing houses warn.
"Standardised stress testing is desirable, but the issue is the detail as to how this is done," said David Weisbrod, chief executive of LCH.Clearnet's US business, who was speaking at a
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