Japanese megabanks face US funding squeeze
High swap costs leave them with few satisfactory alternatives for US dollar funding
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Hong Kong
JAPANESE megabanks are emerging as the biggest victims of a worsening squeeze in the US$1 trillion commercial paper market, as high swap costs leave them with few satisfactory alternatives for US dollar funding.
Investors have pulled billions out of prime money-market funds ahead of new Securities and Exchange Commission (SEC) regulations aimed at preventing a repeat of the liquidity crisis following the collapse of Lehman Brothers in 2008.
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