European transaction tax prompts concerns about collateral

03/20/2013 | International Financing Review (free content)

The European Commission's proposal to tax financial transactions could raise €35 billion annually, but market participants are concerned the levy would put a squeeze on collateral. "It could drastically reduce the mobility of collateral and drastically increase transformation costs, making collateral more inefficient from a mobility perspective," said Staffan Ahlner of Bank of New York Mellon. "We don't believe it is the intention of the proposal, but it is one of the unintended consequences."

View Full Article in:

International Financing Review (free content)

Published in Briefs: