Browse By

Counterparty Limits

Limits are set by an entity in order to manage and control its risks. Counterparty limits restrict the risk exposure to a particular counterparty. They are set so as to reduce the loss that could arise if the counterparty were to default on its obligations. They should reflect the credit quality of the counterparty to the transactions, the company’s own capital adequacy, operations efficiency, credit expertise, the efficiency and reliability of the settlement systems and the period of time for which the exposure will be outstanding. Examples of counterparty limits are the pre-settlement risk (PSR) limit and the settlement risk limit.






Free Courses

View More >>

Recent Posts

  1. Setting Limits for Treasury Risk : Available online risk limits training courses
  2. Setting Limits: Interest Rate Risk Management
  3. Counterparty Risk Limits: Pre-settlement Risk and Settlement Risk
  4. Limits: Trading Limits – Duration, Convexity and PVBP Limits
  5. Setting Limits: Value at Risk and Regulatory Approach Limits
  6. Finance Training Course – Course Outline – Introduction to Derivative Products
  7. Finance Training Course – Course Outline – Derivative Pricing – FX products
  8. Setting up Treasury Limits: Working with Stop Loss Limits
  9. Defining Treasury Limits: Limits Control and Business Processes
  10. Setting Treasury Risk Limits: Defining Risk Appetite, control limits and limit breaches

View More >>