Top banks defer €1.6bn of profits on hard-to-value trades in H1

Leading European dealers set aside hundreds of millions of ‘day-one’ profits on the sale of structured products and complex derivatives over the first six months of the year to reflect valuation uncertainty. 

In aggregate across seven top banks that disclosed their so-called ‘deferred margins’ on these trades, reserves on new transactions totalled €1.6 billion ($1.9 billion) over the first half, compared with €928 million the year-ago half. In addition, the amount of deferred margin released

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