// definition
Netting set
Transactions covered by recognised bilateral netting
Short definition
Under the Basel framework, transactions with a single counterparty covered by a legally enforceable bilateral netting agreement recognised for regulatory capital purposes. A trade without such recognition forms its own set. Opposing contracts with different counterparties belong to separate sets.
risk atlas
Knowledge map
Intuition
Matching economic exposures does not bring different counterparties within the same bilateral agreement.
Related analyses
Primary sources
- Basel Committee, CRE50: netting setParagraph 50.15: one counterparty, enforceable bilateral netting and regulatory recognition; a standalone trade where no recognised agreement applies.