Vince Pacilio, Head of Global Client Management, Insurance, and Paul Traynor, Head of Insurance Services, EMEA, discuss the global impact of regulation on the insurance industry.
Hedging Liabilities
Using Total Return Swaps to Hedge Nonqualified Deferred Compensation Plans
At a time when corporate expenses, in particular executive compensation, are being examined under a microscope, finding ways to lower costs while simultaneously reducing risk and volatility would be considered a victory by any measure. William Blank, Managing Director, BNY Mellon Capital Markets, LLC, an indirect-wholly-owned, non-bank subsidiary of The Bank of New York Mellon Corporation, and Managing Director, BNY Mellon Global Markets, shares our thoughts on a different method for hedging liabilities associated with nonqualified deferred compensation plans using total return swaps. Unlike traditional hedging alternatives, total return swaps are unfunded. This allows the company to retain the use of the deferred cash for more profitable business purposes.
