Know Your Counterparty: The Importance of Centralised, Quality Counterparty Data
At 24 Jul 2008 08:26:44 in RDR-Your View, Reference Data Review
By Rick Enfield, product business owner at Asset Control
The rise of alternative investment classes and derivative products corresponds with an increase in the number of counterparties financial institutions are dealing with today. While financial institutions have kept a close watch on systemic and operational risk factors, additional levels of investment complexity, coupled with a shaky economic environment, have put a new emphasis on the “other” KYC - know your counterparty – and the potential for exposure to counterparty risk. To properly assess any potential counterparty risk, financial institutions are reliant on clean counterparty data, centrally and properly managed.
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