Financial Services Financial Services

Banks that trade OTC derivatives tend to pick nonbank counterparties with bank connections, creating 'risk propagation,' US study says

By Neil Roland
  • 22 Sep 2022 22:13
  • 22 Sep 2022 22:13
Large banks in the over-the-counter derivatives market are more likely to choose nonbank counterparties with multiple bank connections, potentially creating “risk propagation” among bank networks in this opaque market, a federal study released today said.
Banks also tend not to hedge these exposures, partly because of a lack of availability

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Neil Roland

Senior Correspondent

Neil has covered U.S. financial regulation for over two decades, mostly for Bloomberg and Crain Communications. He received a Loeb award for coverage of regulators' response to the collapse of Enron. He also garnered a SABEW award and some Jesse H. Neal awards for stories on the Federal Reserve's response to the 2008 financial crisis. Roland has appeared as a commentator on Fox TV, NPR, C-Span and Bloomberg TV. He received a Master's degree in public policy from Harvard and a Bachelors degree in economics from Cornell.

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