Richard Gomm of Lombard Risk examines how Repo could finally now be given the opportunity to shine and be seen as the platform for effective collateral and inventory management.
Once upon a time, in a regulatory landscape far, far away—may sound like an opening to a fairy tale, but the reality is that the regulatory landscape is now beyond recognition for even the most grizzled and battle-hardened of collateral managers. The Dodd-Frank Act, Basel III, European Market Infrastructure Regulation and other global equivalents have left the collateral pool shuddering at the concept of an unprecedented demand for collateral comprised of high-grade assets and an increase in haircut provisions.
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