The global nature of today’s financial services industry relies upon the interconnection of computer systems world-wide. My purpose today is to identify the serious nature of the problem and the urgent need for immediate action by the government of every nation.
Let me take the example of CCPs and their interactions with the Basel III leverage ratio. Because clearing services require clients to post collateral, the non-recognition of such collateral in the leverage ratio framework may cause banks to scale back their clearing services, potentially leading to an unhealthy concentration of clearing services.