Launch VideoEuro Bank Downgrades Threaten Swap Deals
European bank downgrades have increased the risk that termination clauses or renegotiation payments on billions of dollars of swaps may be triggered by counterparties. Technically called additional termination events, the downgrade clauses have become a common addition to the standard International Swaps and Derivatives Association master agreement as a way to manage counterparty risk on over-the-counter derivatives traded bilaterally.
