Clearing overview - CCP: Difference between revisions

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Clearing overview - CCP (view source)

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 ***Clients have full [[credit risk]] to the [[client money]] [[bank]].
 ***A [[client money]] [[bank]] is not in scope for the [[broker]]’s [[LER]] calculations.
-**'''Client risk to [[intermediary|intermediaries]]''': [TO CHECK WITH SS – wouldn’t the [[client money]] regime deliver [[limited recourse]] because it becomes the client’s secondary pooling event?][Depends on [[limited recourse]] – see below.] [SS: '''{{font colour|red|Yes}}'''this would be a secondary pooling event under UK CASS rules, but TBD how this is treated under non-UK [[client money]] rules.] <br>
+**'''Client risk to [[intermediary|intermediaries]]''': [TO CHECK]<br>
 '''Non-[[cash]]/Securities [[margin]]''':  securities are not an abstract token of value but a representation of a financial right to or over something. It is possible to hold a security without being its owner, and deliver a security to another person without. This means that, unlike [[cash]], one can hold a non-[[cash]] asset as a [[fiduciary]] on behalf of another person.
 *'''[[Title transfer]]''': client delivers asset by outright [[title transfer]] to [[broker]]. There is no purported custody arrangement: The [[broker]]’s obligation, to return an equivalent asset at the end of the transaction, is a debt claim in the client’s hands. As it owns them outright, there are no restrictions in what the [[broker]] can do with the assets (it can, but need not, post them to [[intermediary|intermediaries]]). Note – there is a minor risk to loss of assets in the hands of the [[custodian]].