Banks and CCPs clash over non-default losses

Banks balk at being on the hook for losses from investments or cyber attack, but many clearers say the risk should be shared

Blank cheque
Banks worry they have to give a blank cheque to CCPs

Nobody wants to be the last person at the table when it's time to settle the bill. Yet that's the position banks and their clients could find themselves in if a central counterparty (CCP) were to suffer significant losses – even if nobody has defaulted.

CCPs and their members acknowledge that non-default losses (NDLs) – those incurred by the clearing house unrelated to member defaults – are a risk that needs addressing urgently. In these events, the CCP would not have access to all its various

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 info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact info@risk.net 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 Risk.net? View our subscription options

If you already have an account, please sign in here.

Calibrating interest rate curves for a new era

Dmitry Pugachevsky, director of research at Quantifi, explores why building an accurate and robust interest rate curve has considerable implications for a broad range of financial operations – from setting benchmark rates to managing risk – and hinges on…

You need to sign in to use this feature. If you don’t have a Risk.net 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