Corporate trades should not face CVA charge – Risk.net poll
Two-thirds of respondents think trades with corporates should be exempt from Basel III's CVA capital charge
Banks should not have to hold capital against the counterparty risk on derivatives trades with corporate customers, according to a poll carried out by Risk.net. Sixty-five per cent of respondents said corporate trades should be exempt from the credit value adjustment (CVA) charge, which is part of Basel III.
European legislators have actually considered introducing an exemption. A carve-out initially appeared in a February version of the fourth Capital Requirements Regulation (CRR IV) and
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