Securities financing tools play a critical role in optimizing financial resources for banks in a market structure increasingly reliant on collateral. These transactions, however, introduce intraday credit risk, arising from both the settlement process and market fluctuations that alter the value of securities or collateral provided by borrowers to protect lenders.
The 'Credit Risk in Capital Markets' white paper discusses how regulation may evolve in the future to address intraday credit risk, and the impact this may have on bank financial resources. Additionally, it assesses how emerging technologies, such as Distributed Ledger Technology (DLT), could offer solutions to mitigate these risks.
Thank you Dipak Chotai and JD Risk Solutions for the collaboration!
Read the white paper by clicking here
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