Unblocking the balance sheets



Swaps dealers have always had a problem with redundant trades. While traders try to minimise market exposure by keeping their net positions relatively flat through offsetting buy and sell positions, they are still exposed to counterparty credit risk and operational risk by holding the contracts through to maturity. This means they have to hold regulatory capital against the trades, inflating banks’ balance sheets. The obvious solution is to tear up unwanted trades. But that was

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 [email protected] or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact [email protected] to find out more.

To continue reading...


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: