To adress counterparty risk going forward all financial transactions will move to real-time: payment, settlement, collateral management
Due to the implementation of instant systems time limits will vanish, transfers can be executed 24 hours per day/7 days a week/365 days of the year
As a result of instant environment new liquidity rsiks especially for non-financial corporations arise
Disruptions, mistakes or fraud especially outside regular working hours, during weekends, bank holidays, etc. easily result in liquidity crunch
Collateral management of centrally cleared derivative transactions will also be dynamised going forward, variation margin calculated on a regular basis, 24 hours per day/7 days a week/365 days of the year, which naturally includes additional and higher liquidity risk
Most simple and cost efficient protection is achieved via KLF liquidity back-up insurance, which can provide high quality liquid assets as per BIS definition instantaneously