Esma questions CCP ‘free ride’ for sovereigns

Christian Lee comments on Esma’s latest move

“If you asked a government agency to collateralise those exposures, what would they collateralise it with? Sovereign bonds. This would be futile, as it wouldn’t mitigate the credit risk, because if they go down the collateral is worth nothing”

Christian Lee speaks to Louie Woodall for about why Esma questions CCP ‘free ride’ for sovereigns

Note: This news article was first published by Catalyst prior to the Sionic merger

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I specialise in clearing, risk, derivatives reform and regulation, advising banks, international and regional exchanges and central counterparties how to manage regulatory change.