Asia Pacific Financial Forum
July 7, 2014
Seattle
Asia Pacific Financial Forum
Session 2: Forging Deep, Liquid and
Integrated Capital Markets
Keith Noyes
Regional Director, Asia-Pacific
ISDA
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Copyright © 2014 International Swaps and Derivatives Association, Inc.
Disclaimer: The information contained in this document is intended only for use during the presentation. ISDA accepts no liability whatsoever with respect to the use of this document or its contents.
Presentation Topics
Legal Infrastructure as Risk Mitigant in Capital
Markets:
1) Legal netting infrastructure.
2) Protecting collateral interests.
3) Margining of non-cleared derivatives
2
The effectiveness of netting and collateral as risk
mitigants.
US$ trillions
Notional Amounts, Total OTC contracts1
Gross Market Values
% of Notional Amounts
Gross Credit Exposure (after netting)
% of Gross Market Value
% of Notional Amounts
Exposure collateralized, average, all OTC
derivatives2
Gross Credit Exposure (after netting and
adjusted for collateral)
% of Gross Market Value
% of Notional Amounts
1 Bank
2
Dec.2009 Dec.2010 Dec.2011 Jun.2012
603.900
601.046
647.777
638.928
21.542
3.57%
21.296
3.54%
27.278
4.21%
25.392
3.97%
3.521
16.34%
0.58%
3.480
16.34%
0.58%
3.912
14.34%
0.60%
3.668
14.45%
0.57%
70%
69.8%
71.4%
1.056
4.90%
0.17%
1.051
4.94%
0.17%
1.119
4.10%
0.17%
for International Settlements (BIS), May 2011 and prior, Table 19, http://www.bis.org/statistics/otcder/dt1920a.pdf
ISDA Margin Survey 2012, http://www2.isda.org/functional-areas/research/surveys/margin-surveys
3