What is capital requirements for CCPs?
The 20% risk weight is a minimum requirement. As with other parts of the capital adequacy framework, the national supervisor of a bank may increase the risk weight. An increase in such risk weight would be appropriate if, for example, the clearing members in a CCP are not highly rated.
What is a CCP EMIR?
EMIR introduces a harmonised set of organisational, business conduct and prudential requirements for clearing service providers. CCPs interpose themselves between counterparties to a derivative contract, becoming the buyer to every seller and the seller to every buyer.
What is a third country CCP?
The central counterparties (CCPs) established in a third country listed below have been recognised to offer services and activities in the Union in accordance with Regulation (EU) No 648/2012 of the European Parliament and of the Council of 4 July 2012 on OTC derivatives, central counterparties and trade repositories ( …
What is a qualifying CCP?
A qualifying central counterparty (QCCP) is an entity that is licensed to. operate as a CCP (including a license granted by way of confirming an exemption), and is permitted by the appropriate regulator/overseer to operate as such with respect to the products offered.
What is the effect on capital requirements of bank if it takes exposure on riskier assets?
The competitive pressures seem to have no impact on bank capitalisation or bank risk-taking. Our findings showed that larger banks tend to hold lower capital and have better capability to control risk, mainly through diversification. Finally, we observed that funding decisions are correlated with risk-taking.
What is C factor CCP?
• Under “Interim Rules” currently in place, C-Factor is generated by measuring total default. provisions of the CCP against “Hypothetical Capital” (KCCP) calculated from trade data using. the Current Exposure Method (CEM)
What is CCP in EU?
The European Association of CCP Clearing Houses (EACH) represents the interests of Central Counterparties (CCPs) in Europe since 1992. CCPs are financial market infrastructures that significantly contribute to safer, more efficient and transparent global financial markets.
Who regulates CCP?
Commodity Futures Trading Commission
In the U.S., the equivalent of a CCP is known as a derivatives clearing organization (DCO) or a derivatives clearinghouse and is regulated by the Commodity Futures Trading Commission (CFTC).
What is emir refit?
EMIR REFIT Summary The European Commission’s regulatory fitness and performance programme (REFIT), launched in 2012, is aimed at simplifying EU legislation and reducing any unnecessary regulatory burdens for citizens and businesses.
What is emir finance?
The European Market Infrastructure Regulation (EMIR) is an EU regulation for the regulation of over-the-counter (OTC) derivatives, central counterparties and trade repositories. The objective of the legislation is to reduce systemic counterparty and operational risk, and help prevent future financial system collapses.
What is non qualifying CCP?
non-qualifying CCP’s – markedly preferential capital treatment for QCCP exposures when compared to. bilateral OTC derivative and SFT capital requirements. ➢ Qualifying CCP (QCCP) status is based on CPSS-IOSCO supervision/recognition – and the ability to provide bank’s. with information required to calculate capital.
What is tier1 and Tier 2 capital?
Tier 1 capital is the primary funding source of the bank. Tier 1 capital consists of shareholders’ equity and retained earnings. Tier 2 capital includes revaluation reserves, hybrid capital instruments and subordinated term debt, general loan-loss reserves, and undisclosed reserves.
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