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Got to be certain: The legal framework for CCP default management processes

Jo Braithwaite () and David Murphy
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Jo Braithwaite: London School of Economics

No 37, Bank of England Financial Stability Papers from Bank of England

Abstract: Central clearing offers numerous benefits to financial stability including multilateral netting of cleared exposures and the centralisation of default management. These benefits explain the pivotal role of central counterparties (‘CCPs’) in the post-crisis derivatives market reforms. However they lead to a key financial stability question: will CCPs be able to manage a large member default effectively?

Keywords: CCP; Resolution; CCP resolution; No creditor worse off; NCWO counterfactual (search for similar items in EconPapers)
JEL-codes: K23 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2016-05-11
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