By Philip Alexander
June 8, 2016, Risk
An influential member of the European Parliament's economic and monetary affairs committee (ECON) insists the E.U. should be prepared to go it alone on the application of the leverage ratio, if the internationally agreed version can be shown to harm the provision of client clearing by banks. The industry has long warned that the inclusion of client margin in the calculation of leverage ratio exposures will make client clearing prohibitively expensive.
"It makes sense that the clearing mandate should not be harmed by banks' lack of ability to provide clearing for all clients. If it can be demonstrated that harm is being done to clearing, the E.U. could go its own way on the leverage ratio," said Kay Swinburne, who is ECON co-ordinator for the third-largest parliamentary group, the European Conservatives and Reformists.
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