Skin in the Game – Central Counterparty Risk Controls and Incentives

Louise Carter and Megan Garner
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Louise Carter: Reserve Bank of Australia
Megan Garner: Reserve Bank of Australia

RBA Bulletin (Print copy discontinued), 2015, 79-88

Abstract: The increasing systemic importance of central counterparties (CCPs) has seen recent policy debates focus on the ability of CCPs to withstand a crisis effectively. CCPs maintain prefunded financial resources to cover the potential losses arising from the default of a clearing participant. This article discusses the incentives created by the composition of these resources, and draws out the role of transparency and governance in ensuring these incentives are effective.

Keywords: central counterparties; financial market infrastructures; risk control; CCP capital; incentives; governance; transparency; disclosure (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (1)

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