Counterparty Risk

EDITOR'S PERSPECTIVE

Counterparty Risk Still on Treasury Agendas

Graham Buck April 14

The list of worries keeping treasurers awake at night changes from year to year. Predictably, basic bread-and-butter concerns such as maintaining liquidity and keeping idle cash to a minimum always feature highly, but more recently others such as cybersecurity and regulatory compliance have speedily moved to the top of the agenda. Readers might find this poll of priorities from the halcyon pre-crisis days of 2007 of interest, as it was taken just before the near-meltdown suddenly made assessing and managing financial counterparty risk vital. Although quantitative easing (QE), low interest rates and cheaper oil appear to have eased many companies’ counterparty risk worries, this week’s gtnews focus suggests that the threat has not been banished but is merely dormant. Once access to capital once more becomes easier for some companies than others, the corporate default rate is likely to start rising again. 

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