In June 2021, the Bank of England (BoE) published a discussion paper on supervisory stress testing of central counterparties (CCPs). ISDA and the Futures Industry Association (FIA) responded to the consultation.

Overall, the associations agree with the presented approach. The points made in the consultation response include:

• Given the huge effort to run supervisory stress tests (SSTs), the associations propose for global regulators to join forces and run joint SSTs;
• The associations welcome the inclusion of operational scenarios, especially stressing of porting assumptions and propose to also include non-default losses as a result of defaults;
• The associations propose to not only use plausible scenarios, but also include scenarios that probe recovery and resolution situations;
• The associations propose to analyze contagion risk, for instance by linking the losses at CCPs to the available resourced of clearing members;
• The associations propose additional disclosure, including some disclosure specific to each clearing member.