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Full-Text Articles in Law
Harmonizing European Union Bank Resolution: Central Clearing Of Otc Derivative Contracts Maintaining The Status Quo Of Safe Harbors, Christoph Henkel
Harmonizing European Union Bank Resolution: Central Clearing Of Otc Derivative Contracts Maintaining The Status Quo Of Safe Harbors, Christoph Henkel
Journal Articles
This Article argues that safe harbors for financial contracts should not be expanded in Europe, but instead should be repealed, as suggested by some commentators in the United States. At the very minimum, credit derivatives, swaps, and repurchasing agreements should be subject to a stay, and the resolution authorities in the Member States should have the power to assume beneficial contracts and to reject other unfavorable contracts. Also, the power of resolution authorities to transfer derivative positions in full or in part should not be sanctioned in favor of a full transfer. Rather, resolution authorities should have the power to …
The Federal Reserve’S Use Of International Swap Lines, Colleen Baker
The Federal Reserve’S Use Of International Swap Lines, Colleen Baker
Journal Articles
This Article focuses on the U.S. Federal Reserve's controversial practice of loaning U.S. dollars to foreign central banks, which the foreign central banks then turn around and loan to institutions in their jurisdictions. The Federal Reserve does not know the identity of these recipient institutions. Nevertheless, these loans-termed "swap lines"-provide foreign financial institutions the type of financial stability that the U.S. Federal Reserve was created to provide for U.S. banks during times of crises. During the financial crisis, the U.S. Federal Reserve arranged swap lines with 14 foreign central banks for a total amount of $583 billion, making it the …