JPM Risk Chief: CCP Need 'Skin In The Game'
By Mike Kentz
Published: March 21 2011 Derivatives Week
Regulators should force derivatives clearing organizations to retain 50% of their earnings over the previous four years in a segregated deposit account, on a rolling basis, as a safeguard in the case of counterparty defaults, said Barry Zubrow, chief risk officer at JPMorgan, in a comment letter to the Commodity Futures Trading Commission. The letter also prescribed the account be subject to a minimum floor of USD50 million, representing what Zubrow called DCOs having a “skin in the game contribution to its own financial safeguards.”
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