CCP
WHAT IS THIS? A central counterparty (CCP) manages default risk by collecting initial and variation margin from both parties to a trade. Spill-over losses are absorbed via a default fund to which all members contribute – introducing a degree of mutualised risk – and by the CCP’s own capital. The concept is an old one that was extended to over-the-counter derivatives in the aftermath of the financial crisis.
Relief for dealers as Basel reins in capital for cleared trades
Basel Committee addresses long-standing complaints over default fund exposures and client clearing
Asia CCPs unlikely to fully comply with Iosco before end-of-2012 deadline
New levels of complexity and ongoing regulatory framework discussions mean full compliance with Iosco’s new principles is unlikely before the January 1, 2013 deadline
CCPs wary of covered bonds despite Esma proposal
LCH.Clearnet and Eurex will not accept own-name covered bonds as collateral, despite green light from Esma
Steering towards new CCP principles: William Dudley interview
Principle character: William Dudley interview
CCP recovery and resolution: New tools, but no rules
Apocalypse never?
Coleman warns of stability dangers from regulatory reform
In search of stability
Extraterritoriality remains a major issue, says FSA’s Lawton
Resolving issues around the extraterritorial application of derivatives regulation is a major outstanding issue that needs to be addressed, says FSA’s acting director of markets
How Asia is progressing towards OTC clearing deadline
The clock is ticking
Risk & Return Canada: CCPs won’t stop future crises, says academic
Central counterparties a ‘Maginot line’ that won’t prevent financial breakdown, argues Queen’s University at Kingston assistant professor
Banks hope for CCP capital concessions at Basel meeting
Banks and CCPs are pressing for changes to method of calculating default fund capital
CCP resolution plans start to take shape
LCH.Clearnet's re-launched CDS clearing service adopts a loss-sharing mechanism - in line with a "last gasp of breath" approach outlined in an Isda letter to the Bank of England
Q&A: William Dudley on global CCP standards
Central counterparties are about to take centre stage in the revamped over-the-counter derivatives markets – a development that has given rise to a set of global principles for their management and supervision. William Dudley, president of the Federal…
SwapClear hits $1 trillion mark for buy-side OTC clearing
A third of the figure was cleared in the last month alone - and volumes are expected to increase rapidly as clearing deadlines approach
Risk & Return Brazil: BM&F Bovespa plans to integrate clearing houses
Plan to combine four clearing houses into one will result in margin efficiencies of 30-40%, the exchange estimates
US farm lenders fear clearing will trip leverage ratio
Posted collateral cannot be used to offset liabilities when calculating farm credit banks' leverage ratio
Dealers pitch loan format for swaps as CVA dodge
Banks are offering to replicate the economics of OTC swaps in loan format - avoiding new capital and clearing rules
NY Fed's Dudley fears CCP capital 'cliff effect'
Supervisors should ensure the capital regime for cleared trades avoids a sudden leap in risk weights, says New York Fed president
HFT adds value to the forex market, says Bank of England
The effects of high-frequency trading activity should continue to be monitored, but the practice adds value to the forex market, argues a senior Bank of England official
Custody Risk summer 2012
Read the summer 2012 issue of Custody Risk
Custody Risk Americas Awards 2012 – Derivatives Valuation Services Provider of the Year: JP Morgan
Derivatives Valuation Services Provider of the Year: JP Morgan
The last word: Collateral and CCPs
The leading question
No improvement in porting since Lehman, CCPs say
The collapse of MF Global last year saw clearing houses struggle to port client collateral to other firms - repeating problems seen after Lehman Brothers filed for bankruptcy in 2008
MarkitServ and Traiana vie to build clearing utilities
Middleware firms set to compete in creation of credit-checking hub - but critics say rival utilities would undermine the service