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Template:Crmtechniques: Difference between revisions
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[[CRM technique]]s under the [[Standardised Approach to Credit Risk|Basel]] [https://www.bis.org/publ/bcbsca04.pfd Standardised Approach to Credit Risk] framework are broken down as follows: | [[CRM technique]]s under the [[Standardised Approach to Credit Risk|Basel]] [https://www.bis.org/publ/bcbsca04.pfd Standardised Approach to Credit Risk] framework are broken down as follows: | ||
*'''[[Title transfer collateral arrangement|Collateralised transactions]]''': A bank has a [[credit exposure]] which it hedges<ref>This is what it says, and I suppose it is true, even though “hedging” is a curious way of describing it</ref> [[in whole or in part]] by {{csaprov|collateral}} posted by a counterparty or a [[credit support provider]]. (Often there is no more than a fag paper between a [[TTCA]] and an on-balance sheet [[netting]] arrangement)<ref>In many cases (e.g. the {{isdama}} a collateral arrangement will be delivered under a “{{isdaprov|transaction}}”, and so will explicitly be a master netting arrangement</ref>. | *'''[[Title transfer collateral arrangement|Collateralised transactions]]''': A bank has a [[credit exposure]] which it hedges<ref>This is what it says, and I suppose it is true, even though “hedging” is a curious way of describing it</ref> [[in whole or in part]] by {{csaprov|collateral}} posted by a counterparty or a [[credit support provider]]. (Often there is no more than a fag paper between a [[TTCA]] and an on-balance sheet [[netting]] arrangement)<ref>In many cases (e.g. the {{isdama}} a collateral arrangement will be delivered under a “{{isdaprov|transaction}}”, and so will explicitly be a master netting arrangement</ref>. | ||
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*transfer under a [[pledged collateral arrangement]] — at least [[to the exent]] that the bank doesn’t surrender legal title<ref>Do not get me started on [[rehypothecation]].</ref> to the collateral at all — will leave the bank with no counterparty {{tag|credit exposure}} at all to the haircut or excess, seeing as it is the bank’s, and if the counterparty goes [[bust]], the bank will be entitled to have it returned in full. | *transfer under a [[pledged collateral arrangement]] — at least [[to the exent]] that the bank doesn’t surrender legal title<ref>Do not get me started on [[rehypothecation]].</ref> to the collateral at all — will leave the bank with no counterparty {{tag|credit exposure}} at all to the haircut or excess, seeing as it is the bank’s, and if the counterparty goes [[bust]], the bank will be entitled to have it returned in full. | ||
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