Key Brexit Clash Would Cost Euro Swap Traders $2.4 Million a Day
- Dutch professor estimates cost of fragmentation of clearing
- Permission for cross-border clearing expires in June next year
Commuters walk along London Bridge.
Photographer: Jason Alden/BloombergThis article is for subscribers only.
One of the biggest Brexit battlegrounds between the European Union and the U.K. now has a price tag: at least $2.4 million a day.
That’s how much any move by the European Union to cut off access to London’s dominant clearinghouses for derivatives could cost traders in euro interest rate swaps, net of buying, according to an estimate from Albert Menkveld, professor of finance at Vrije Universiteit Amsterdam, who has sat on advisory panels to European regulatory authorities.