BMSC and BMDC as Central Counterparty (CCP)
Overview
The novation process by CCP and its undertaking to guarantee settlement of trades, provide confidence to the market on the performance of the contracts, even under the unlikely event where clearing participant defaults. It also serves to ensure the safety and robustness of the clearing and settlement system to prevent any systemic impact risk to the market.
Bursa Malaysia employs a comprehensive financial risk management framework to protect the financial integrity of the organisation and hence prevention of systemic risk to the marketplace. While financial risks could be the most significant risk of the CCPs, operational risks also require active monitoring and management.