Variation margin
WHAT IS THIS? Variation margin is a payment – typically made daily, in cash – to reflect changes in the market value of a trade, or portfolio of trades. In over-the-counter derivatives markets, variation margin is traditionally seen as a buffer against counterparty default; in listed derivatives, it is treated as settlement.
Lehman Brothers ruling changes equation for creditors and clients
Protection racket
Sponsored webinar: OTC derivatives clearing
Preparing the ground for the derivatives deadline
US farm lenders fear clearing will trip leverage ratio
Posted collateral cannot be used to offset liabilities when calculating farm credit banks' leverage ratio
Credit Risk USA: Direct buy-side clearing 'not feasible'
Added cost and mutualised risk will discourage direct clearing participation, panel concludes
The last word: Collateral and CCPs
The leading question
Isda AGM: Margin regime ups liquidity risk, buy-side firms warned
Collateral demands will be pro-cyclical - rising as markets become stressed - and will be generated by uncleared as well as cleared trades, DE Shaw treasurer tells Isda conference
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Ever heard of the WGMR?
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The extraterritorial scope of US margin rules would have left US banks’ overseas swaps business in tatters, but an international working group looks set to deliver a reprieve by endorsing similar rules
US banks could lose competitive edge in Europe, says EIB
US regulations on mandatory clearing and uncleared margin could put US dealers at a competitive disadvantage in Europe, says EIB
European regulators undecided on initial margin rules for uncleared swaps
Counterparties will have to post variation margin on uncleared trades – but questions remain over which firms will have to post and collect initial margin
Swaps push-out a 'vast overreaction', says OCC's Walsh
Section 716 of the Dodd-Frank Act is based on a misperception of OTC derivatives, says acting OCC head - who also acknowledged criticism of US uncleared margin proposals
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Risk awards 2012
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CFTC urged to rethink rules that threaten cross-margining
Pushed to the margins
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From micro to macro: Basel III tools eyed as systemic risk controls
Keeping the lid on
Margin minutiae at issue in Jefferies v IDCG suit
Mire in margin minutiae
In defence of cross-product margining
In defence of cross-product margining
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CME and IDCG revalue swaps using OIS discounting
Switch to OIS comes a year after SwapClear revalued parts of its portfolio
Standard CSA: Industry's solution to novation bottleneck gets nearer
New CSA, new challenge
Fannie Mae says FHFA's margin rules would drive up hedging costs
US mortgage giant says segregating variation margin will hurt FHFA- and FCA-regulated entities, and create new funding obligations for swap dealers
Central bank liquidity would help CCPs in distressed situations, says BIS
BIS weighs in on CCP central bank liquidity access debate