OCC's Default Fund: Concentration Risk & Capacity Crunch
Update: 2025-11-30
Description
OCCs Default Fund: A Concentration of Risk - The Options Clearing Corporation (OCC) handles 70 million contracts daily, with five firms contributing nearly half of its default fund. This concentration, including Bank of America, Goldman Sachs, and ABN Amro, poses risks if a major player fails. The derivatives markets boom has led to a capacity crunch, causing more market makers to bypass banks. The OCC is exploring ways to spread risk and adjust its default fund calculation to account for extreme market events.
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