Banks have been shedding risky assets to show regulators that they are not as vulnerable as they were during the financial crisis. In some cases, however, the assets don’t actually move—the bank just shifts the risk to another institution.
This trading sleight of hand has been around Wall Street for a while. But as regulators press for banks to be safer, demand for these maneuvers—known as capital relief trades or regulatory capital trades—has been growing, especially in Europe.
Read the complete article at CNBC here.
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