Jo Braithwaite co-authors new BoE paper

Jo Braithwaite, Associate Professor of International Commercial Finance Law at the LSE Law Department and Research Associate of the SRC, has recently published the paper Got to be certain: The legal framework for CCP default management processes (2016) Bank of England Financial Stability Paper 37 with David Murphy of Bank of England. 

This paper studies the legal certainty of CCP (central counterparties) default management practices. The authors discuss the processes of clearing and collateral posting in detail, establishing the nature of the rights which CCPs rely upon when managing defaulting members. They then consider the relationship between CCP default management processes and insolvency law, as defaulting members are sometimes (but not always) insolvent. This leads to an evaluation of the legal issues arising along a typical default timeline of default declaration; returning to a matched book; and use of the defaulter’s collateral.

Read the abstract and paper here.