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Intra-group margin will ‘stifle’ internal hedging, banks warn
Banks in the US are lobbying against a requirement to post initial margin for internal trades
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Banks in the US will be forced to rework how they manage risk if they are granted no exemption from posting initial margin on uncleared derivatives in intra-company trades, dealers have warned. A carve-out exists under European Union and Japan rules but not in the US, which will double costs and ultimately be passed on to end-users, the dealers say.
"We are concerned that there is no inter-affiliate in the US rules, but the EU and Japan rules do allow for it. We think it would be a disadvantage
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