Credit support: Difference between revisions
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imported>Doug Williamson (Expand 2nd definition.) |
imported>Doug Williamson m (Amend links.) |
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1. ''Credit risk - derivative instruments''. | 1. ''Credit risk - derivative instruments''. | ||
In the context of derivative financial instruments, credit support | In the context of derivative financial instruments, credit support reduces counterparty credit risk. | ||
Usually by requiring collateral - also known as margin - to be posted by the counterparties. | Usually by requiring collateral - also known as margin - to be posted by the counterparties. | ||
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* [[Security]] | * [[Security]] | ||
* [[Trade finance]] | * [[Trade finance]] | ||
[[Category:Accounting,_tax_and_regulation]] | [[Category:Accounting,_tax_and_regulation]] | ||
Latest revision as of 12:54, 8 April 2021
1. Credit risk - derivative instruments.
In the context of derivative financial instruments, credit support reduces counterparty credit risk.
Usually by requiring collateral - also known as margin - to be posted by the counterparties.
2. Credit risk management.
Any form of credit risk reduction, for example in the context of bonds and guarantees supporting trade finance.
Also known as credit enhancement.
