Coronavirus rout revives attacks on futures margining

FCMs call for permanently higher margins following “unprecedented” number of breaches

Banks have accused futures and options clearing houses of charging margins on benchmark futures and options contracts that are too low, after margin breaches piled up during two weeks of volatile trading.

A breach occurs if a clearing house member is not holding enough initial margin to cover the one-day change in a contract’s value. Viewed in isolation, the central counterparty would be exposed if the member defaulted at this point.

Two heads of bank clearing businesses – known in the US as