Latest Margin Proposal Riles End Users


It's confirmed: U.S. banking regulators want companies that use over-the-counter swaps to post margin, at least those nonfinancial firms deemed riskier credits by their bank counterparties.

Five federal banking regulators issued a proposal Tuesday that would require nonfinancial companies to post margin on swap transactions if the net market value of their positions exceeds thresholds determined by their bank counterparties' normal credit processes. Companies with riskier credit profiles would face lower thresholds and vice versa.

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