Derivatives Regulation Case Study: Regulatory Compliance Assessment Our Client: A Fortune 100 technology company with international operations and multiple hedging programs involving exchange-traded and over-the-counter (OTC) derivatives across different asset classes, including foreign exchange, interest rates, and credit. Situation: The company was concerned about the impact of new derivatives regulations on its hedging programs, including how the parent company and numerous subsidiaries might be classified under Title VII, what new regulatory requirements might apply, and the extent to which hedging costs may increase due to new regulatory requirements. The client’s hedging programs spanned multiple global regulatory jurisdictions and included several different entities including both financial and nonfinancial entities. Summary: Chatham conducted an in-depth review of the hedging programs, spending two days onsite at the client’s premises to interview stakeholders within the company, including representatives from treasury, risk, operations, legal, and…

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Life at Chatham Regardless of role or tenure, Chatham is a place where people are valued, and we recognize this through providing opportunities for growth and a positive work environment.. From a thoughtful interview experience and intentional workspaces to company events and volunteer opportunities, Chathamites have many ways to engage. Learn about the Foundations of our Vibrant Culture Trust, Mental Shelf Space & 3rd Stage Performance Central to Chatham’s impact in the marketplace is the pre-eminent role of trust in everything we do. Whether with clients, colleagues, or in our industry as a whole, we strive to align ourselves with a multi-faceted understanding of trust. In addition to our focus on trust, Chathamites work to seize what we call “mental shelf space,” which allows someone to take on increasing amounts of influence in a particular role or responsibility. Chathamites ultimately…

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Managing interest rate risk as a factor of ROI Significant debt at a portfolio company increases the risk of interest rate volatility. This can significantly impact EBITDA. Hedging interest rate exposure helps offset this risk and reduces the potential of earnings volatility due to rate fluctuations. Chatham Financial assists clients in managing such exposure as well as the impact on returns by such potential business events as IPOs and re-financings. How Chatham helps manage the risk of interest rate fluctuations Risk assessment and analysis: Chatham works with sponsors and their portfolio companies to determine optimum hedging strategies. We analyze potential unhedged exposure and evaluate hedging alternatives and breakage scenarios. Our deep insight into market trends includes preferred structures, tenor, and hedge ratios. Hedge accounting treatment: Hedge accounting treatment is not an afterthought for Chatham. Our deep expertise in the standards…

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