'Hidden leverage' to blame for LDI crisis, WPC told

Parliamentary committee hears that liquidity crisis was a ‘predictable’ risk

Jonathan Stapleton
clock • 4 min read
Con Keating: We said this was an endogenous risk spiral and should be expected to happen
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Con Keating: We said this was an endogenous risk spiral and should be expected to happen

“Hidden leverage” was the cause of the “entirely predictable” liability-driven investment (LDI) crisis of the past two months, a Work and Pensions Committee (WPC) inquiry has been told.

In the opening session of the first formal meeting of the WPC's inquiry into defined benefit (DB) pensions with LDI - held this morning (23 November) - the committee heard evidence from independent...

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