counterparty risk

noun

1. the risk that a person who is a party to a contract will default on their obligations under that contract

Example Sentences

"Participation in centrally cleared transactions can significantly reduce this counterparty risk," it said.

From Reuters

Since then investors across the board have been sharpening their scrutiny of banks and strengthening their cash-management guidelines to plug the gaps exposed in their approach to counterparty risk and liquidity management.

From Reuters

Managers who miss CLS's cut off will settle bilaterally, losing out on cost efficiency and risk mitigation, while heightening counterparty risk.

From Reuters

Large companies are spreading out their counterparty risk and increasing screening of their banking partners in response to the recent banking crisis that has been a "wake-up call", according to an industry survey to be released on Thursday.

From Reuters

"For the buy-side, FX clearing materially lowers counterparty risk, enables portfolio optimization and provides operational benefits," said James Pearson, head of ForexClear.

From Reuters