Isda reports 75% increase in collateral use for derivatives trades

Collateral use in over-the-counter derivatives transactions and related margined activities such as repos and structured products increased 75% from $250 billion in 2001 to $437 billion this year, said the International Swaps and Derivatives Association today.

“The growth in collateral use demonstrates the commitment of derivatives dealers and end-users to effectively manage counterparty credit exposures,” said Robert Pickel, Isda's chief executive, in a statement.

But some ambiguity surrounded Isda’s latest figures, as the number of companies that took part in this year’s survey – 71 – is far more than the 43 that took part last year. The New York-based trade association was not immediately available for comment.

Isda said credit risk reduction continues as the most important reason for respondents using collateral, followed by regulatory capital savings. Access to more complex trades and the ability to price more competitively are also factors, said Isda.

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 or view our subscription options here:

You are currently unable to copy this content. Please contact to find out more.

Credit risk & modelling – Special report 2021

This Risk special report provides an insight on the challenges facing banks in measuring and mitigating credit risk in the current environment, and the strategies they are deploying to adapt to a more stringent regulatory approach.

The wild world of credit models

The Covid-19 pandemic has induced a kind of schizophrenia in loan-loss models. When the pandemic hit, banks overprovisioned for credit losses on the assumption that the economy would head south. But when government stimulus packages put wads of cash in…

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