Allfirst

[shanlane]

Hello,

Why would the Forex trading desk be under the treasury department? If the goal was ALM in foreign currencies I could understand that, but it seems like this was supposed to be an arbitrage desk. It just does not seem like it would (or should) have been under the "treasury" blanket.

Does this make sense or am I missing something?

Thanks!

Shannon

 

[ibrahim-1987]

Hi shannon
I think it should be under treasury blanket, because they were first only hedging, but then when AIB acquired allfirst, & rusnak joined them, the strategy became making profits, so positions that were taken by them were exposed to market risk, I mean they became trading book instead of banking book.

This argument remind of a discussion about banking book and trading book, and wether banking book items should be managed and measured like trading book items at least in term of risk management, not in term of accounting.

In my opinion, every position that has daily price market movement, must be monitored, measured & managed like trading book IN TERM OF RISK.

 

[shanlane]

That makes sense.

Thanks!

Shannon