FIA joined with the International Swaps and Derivatives Association and the Institute of International Finance in responding to a discussion paper issued by the Financial Stability Board on the treatment of CCP equity in resolution. The trade associations set out in their response why CCP equity is currently insufficient for dealing with extreme events, including both defaults and non-default losses, and propose a combination of CCP equity and other tools to ensure sufficient resources are available. The associations also set out why a “no creditor worse off” safeguard should not apply to CCP equity.
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FIA and other associations respond to FSB discussion paper on treatment of CCP equity in resolution