Derivates : The Risk is shifting to CCPs

At the annual general meeting of the International Swaps and Derivatives Association in Singapore concluded

June's multi-colored eyes

yesterday,a group of panelists highlighted the lack of clarity over resolution for failed Central counterparty (CCPs) as a significant concern for the G20 objectives of eliminating systemic risk.

Central counterparty clearers stand to be the next “too-big-to-fail” institutions and could pose an acute threat to the
financial system if regulators stall on plans to manage the potential failure of a clearing entity.

There are two main processes that are carried out by CCPs: Continue reading “Derivates : The Risk is shifting to CCPs”

Basel Becomes Babel

A very good analysis done on the various Basel agreements at Bloomberg here are some highlights from it.traders

The first Basel agreement on global banking regulation, adopted in 1988, was 30 pages long and relied on simple arithmetic. The latest update, known as Basel III, runs to 509 pages and includes 78 calculus equations.

The complexity is emblematic of what happened over the past four years Continue reading “Basel Becomes Babel”

FSB report on shadow banking

Greek deal done: 124 pct Debt to GDP in 2020, a sigh of relief for the Euro-zone. In the mean while on 18th November FSB came out of 14 page report and,  I was reading the FSB report on shadow banking. The most important issue here is the fifth work-stream  securities lending and repo — yet the proposals seem, well, a little bland. Here are the suggestions in brief:

  1. Improving regulatory reporting Continue reading “FSB report on shadow banking”