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.
Derivatives exchange of the year: CME Group
Risk awards 2011
Clearing house of the year: LCH.Clearnet
Risk awards 2011
Hong Kong lawmakers to enforce mandatory CCP by the end of 2012
Hong Kong joins Japan in mandating central counterparty clearing for OTC derivatives with CCPs and a central repository expected to be set up in the coming months.
Asia to follow US on clearing amid fears about hedging costs for exporters
Asian banks likely to opt for harmonised OTC clearing approach with the US and expect higher hedging costs for corporates
Video: SGX’s Sutat Chew on alternative markets and CCP
Traditional exchanges have nothing to fear from alternative trading venues as long as they keep innovating, according to the Singapore Exchange’s head of corporate and market strategy. OTC derivatives central counterparty clearing, meanwhile, presents a…
Basel III won’t be a problem if implemented correctly, says Bank of England
Latest Financial Stability Report stresses importance of long transition to new rules, and concerns over central counterparty clearing
Basel Committee publishes final Basel III rules
The Basel Committee has finalised its Basel III package - but work in certain areas will continue into 2011
LCH.Clearnet poised to announce FX options venture
Clearer will extend coverage to third asset class in 2011, with support from 13 banks
MarkitServ updates novation process after two-month delay
Middleware provider MarkitServ now in line with industry standard - two months after initially planned and more than three months after rival Ice Link.
Basel Committee considers capital charges on CCP default fund exposures
Basel Committee considers capital charges on CCP default fund exposures
CCP turf war simmers as OTC regulations head to the European Parliament
CCP turf war simmers as OTC regs head to European Parliament
Forex markets hope for CCP exemption
All settled?
Technology
Special report
Review of 2010
Crisis? Oh, that crisis...
Middleware key to clearing success
The ware-rich project
CFTC heeds buy-side demands for increased margin protection
The price you pay
CFTC commisioners express misgivings over Dodd-Frank rule-making
Senior regulators reveal "concern" over segregation of margin and swap data repositories
Market endorses 'elegant' CFTC proposal on margin
Legally segregated/operationally commingled approach to margin segregation attracts praise from buy- and sell-side.
Asia Risk Congress 2010: Asian banks prepare for national clearing houses
Several Asian nations could compel their banks to clear swaps in-country - others seek to join foreign CCPs on special terms
CCP interoperability challenges in Asia
Clearing confusion
Concern over scarcity of high-quality assets forces CCPs to broaden eligible collateral
Ice Clear Europe accepts gold for margin, while LCH.Clearnet is also working on extending eligible collateral
Quant Congress Europe: Basel III CVA charge political, says Swiss regulator
Finma official hits back at industry criticisms of counterparty risk charge, but concedes political pressure to hurt OTC market is undeniable
Risk USA: Futures clearing model not secure, says Prager
Futures clearing model less secure for over-the-counter derivatives than bilateral trading, says BlackRock trading head
Dealer concern over proposed change to client margin segregation
Ice Trust estimates it might have to increase initial margin by 63% to cover risk.