Customer Quote by Blythe Masters
“Unfortunately, tools that transfer risk can also increase systemic risk if major counterparties fail to manage their own risk exposures properly.”
About This Quote
Source Speech: Financial Stability Forum, 2015
Risk transfer mechanisms can amplify systemic danger if counterparties mismanage exposure.
In simple terms: Risk sharing can increase overall risk.
Monitor counterpart risk health.
Themes
Mood
Type
When to use this quote
- banking
- insurance
- derivatives markets
- regulatory oversight
Key Concepts
Questions to Reflect On
- How can we ensure counterparty resilience?
- What safeguards reduce systemic spillover?
Risk transfer may backfire without robust oversight.