MoneyGlossary.com
Home  

Bilateral Netting

Definition: [crh] Bilateral netting - the consolidation of all swap agreements between two counterparties into one master agreement. The result is that if one counterparty bankrupts, that counterparty cannot seDefinition: ek to collect on any swaps that are in-the-money to them while at the same time refusing to pay out on any that are out-of-the-money. Instead, the master agreement sets out that in this event all swDefinition: aps between the two counterparties will be netted; only then will the bankrupt company receive money, and then only if they are net in-the-money.

<< Go back