Â鶹´«Ã½

Home   News   Features   Interviews   Magazine Archive   Symposium   Industry Awards  
Subscribe
Â鶹´«Ã½
Leading the Way

Global Â鶹´«Ã½ Finance News and Commentary
≔ Menu
Â鶹´«Ã½
Leading the Way

Global Â鶹´«Ã½ Finance News and Commentary
News by section
Subscribe
⨂ Close
  1. Home
  2. Industry news
  3. ESMA provides feedback on how CCPs should consider internal risk
Industry news

ESMA provides feedback on how CCPs should consider internal risk


04 July 2018 Paris
Reporter: Jenna Lomax

Generic business image for news article
Image: Shutterstock
The European Â鶹´«Ã½ and Markets Authority (ESMA) has published its opinion which sets out how central counterparties (CCPs) in the EU should consider in their internal risk models the liquidity risk posed by all entities towards which the CCP has a liquidity exposure.

The opinion, published under the European Markets Infrastructure Regulation, details ESMA’s view on how CCPs should assess liquidity risk, and by so doing promotes convergent risk management practices and risk control across EU.

This opinion outlines the assessment of the liquidity risk posed by liquidity providers regardless of whether or not these were a clearing member.

ESMA clarifies that CCPs should include, in the measurement of their liquidity needs, the default of their top two clearing members in all their capacities vis-à-vis the CCP.

ESMA stated this should be done in addition to assessing in their stress testing scenarios, all entities towards which the CCP has a liquidity exposure.

ESMA’s opinion is addressed to competent authorities responsible for CCP supervision.
← Previous industry article

Top of hot stocks: Countrywide PLC (CWD)
Next industry article →

ESMA releases annual report
NO FEE, NO RISK
100% ON RETURNS If you invest in only one securities finance news source this year, make sure it is your free subscription to Â鶹´«Ã½ Finance Times
Advertisement
Subscribe today
Knowledge base

Explore our extensive directory to find all the essential contacts you need

Visit our directory →
Glossary terms in this article
→ Default
→ Liquidity

Discover definitions, explanations and related news articles in our glossary

Visit our glossary →