Compression could ease Libor transition

摘要

Swaps compression services that helped banks to slash US$1 quadrillion of derivatives notional could play a vital role in transitioning hundreds of trillions of dollars of contracts away from Libor. Collapsing (or tearing up, in the jargon) entire swaps portfolios and rebuilding them using alternative rates could ease the challenge posed by regulators' efforts to wean US$500trn of derivatives and loans off the scandal-hit benchmark by the end of 2021.