Clearing houses reject standardised 'skin in the game'
Forcing CCPs to make overly large contributions could encourage clearing members to take on extra risks subsidised by others, the WFE says
The World Federation of Exchanges (WFE) has rejected suggestions that its central counterparty (CCP) members should be subject to standardised 'skin-in-the-game' capital requirements, warning that such one-size-fits-all approach could encourage unwarranted risk-taking by clearing banks.
"CCPs have the most expertise about their markets, participants and market structure, and must be tasked with sizing their contributed capital in a manner that reflects the alignment of clearing member and CCP
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