LCH and dealers clash over loss allocations

Isda AGM: CCP equity should not be spared, say clearing members

LCH.Clearnet says losses should be borne by market, not CCPs

LCH.Clearnet and its dealer members are divided over whether clearing houses should compensate non-defaulting members if they have to absorb losses caused by another member's default.

Central counterparties (CCPs) have a set amount of resources for such situations, the distribution of which is allocated via a waterfall. Losses would first be met by a defaulting member's initial margin and default fund contribution, followed by non-defaulting members' default fund contributions, and then a

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