FX Week

Japanese Banks Embrace Netting As U.S. Banks Scramble To Sign Deals

DEALING & NETTING

Leading Japanese players in foreign exchange are entering bilateral netting agreements with major U.S. banks but so far only the Bank of Tokyo has gone beyond the minimum steps, sources say. Bank of Tokyo has entered novation contracts with Citibank and Chemical Bank, having earlier signed up to use FX Net, the bank consortium that runs a bilateral foreign exchange netting service based on the novation method of netting (FX Week, January 24).

The Japanese banks' hesitancy may in part be due t