The World Federation of Exchanges (WFE) welcomes the opportunity to respond to ESMA’s consultation on guarantees as CCP collateral and certain aspects of CCP investment policy. WFE members include a broad cross section of CCPs with experience of accepting, limiting, or declining guarantee-based collateral in a range of markets.
The WFE recognises that guarantees such as uncollateralised bank guarantees may provide targeted liquidity relief in times of stress, particularly for non-financial participants in markets when other types of collateral are scarce. This can diversify margin funding sources and support orderly risk management. When appropriately structured, such instruments can function as reliable, cash-equivalent resources within CCP liquidity frameworks.