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Climate Change Risk in Financial Markets: Advancing the Conversation in 2021

The Federal Reserve Bank of Chicago’s Financial Markets Group is opening 2021 with a conversation on climate change risk in financial markets.

Panelists representing diverse perspectives will answer and discuss a variety of questions including:

  • How has climate change risk impacted global financial markets to date, and what can we expect moving forward?
  • What are some of the key developments to watch out for—in terms of technology, investing practices, legal and regulatory developments?
  • What role can financial markets and the public sector play in better managing climate change risk?
  • What are some of the challenges and opportunities for existing efforts?


Alessandro Cocco

Alessandro Cocco

Vice President
Federal Reserve Bank of Chicago

Opening Remarks

Nahiomy Alvarez

Nahiomy Alvarez

Senior Financial Markets Analyst
Federal Reserve Bank of Chicago


Anita Herrera

Anita Herrera

General Counsel & Chief Regulatory Officer
Nodal Exchange, LLC


Steven Kennedy

Steven Kennedy

Global Head of Public Policy
International Swaps and Derivatives


Christopher Palazzolo

Christopher Palazzolo

Principal and Head of Responsible Investment and EMEA
AQR Capital


Steven Rothstein

Steven Rothstein

Managing Director, Accelerator
Ceres, Inc


Publications, conferences and news

Our staff frequently publishes articles, working papers, conference agendas, and more. You can view them all below, or use the dropdown to select a specific category.

Currently viewing:

The next Joint Deutsche Bundesbank – European Central Bank – Federal Reserve Bank of Chicago Conference on CCP Risk Management will be hosted in early March 2021


Can Central Counterparties (CCPs) Use Improved Buffers to Reduce Cyclical Funding Demands on the Market?

By Ketan B. Patel

In this blog post, Ketan B. Patel investigates changes in margin at central counterparties (CCPs) during the market stress of 2020:Q1 to show how reactive CCP funding demands were to the increase in market volatility. He examines whether rainy day funding in the form of buffers might be useful in supporting the broader resilience of the clearing ecosystem.

A New Framework for Assessing Climate Change Risk in Financial Markets

By Nahiomy Alvarez, Alessandro Cocco, and Ketan B. Patel

While there is growing recognition that climate change poses a new risk for the economy, more research is needed to understand how climate change risk affects global financial markets. We establish a new framework for this research by merging the climate change risk categories of physical risk, transition risk, and liability risk with the risk categories commonly assessed in the financial markets: market risk, credit risk, liquidity risk, and operational risk. We then factor in market structure and market regulation as we seek to assess the overall impact of these variables on systemic risk. Our framework shows that climate change affects each of the risk-management categories commonly assessed in the financial markets as well as the ways that they interact to generate broader systemic risk.

7th Annual Conference on CCP Risk Management

Ketan B. Patel will moderate a panel discussion on Resilience and Lessons Learned in Central Clearing in 2020. Senior policymakers, central bankers, market regulators, industry leaders and others are invited to participate in the conference. The CCP Risk Management Conference is by invitation only. To encourage candid discussion among invited participants, the conference is conducted under the Chatham House rule and is not open to the press. This conference has been very well attended in the past.

Diversity in Financial Markets

The Chicago Fed and FIA teamed up with a group of expert panelists to explore past and present experiences, as well as the outlook for diversity in financial markets. The panelists explored why diversity is important, how to achieve it, and what metrics could be used to determine progress. During this interactive webinar, panelists also shared their experiences and answer audience questions on impactful changes and how to move your organization and the broader industry forward.

Watch the recording here.

What Are the Financial Systemic Implications of Access and Non-Access to Federal Reserve Deposit Accounts for Central Counterparties?

By Maggie Sklar

In this working paper, I examine the interconnections between designated derivatives central counterparties (CCPs) with Federal Reserve deposit accounts and non-designated CCPs and the potential financial stability implications. This working paper notes the interconnections between the non-designated and designated derivatives CCPs through their clearing members and the commercial custodial banks they utilize to hold and transfer collateral. The paper then identifies additional potential contagion risks and financial stability risks, including liquidity risk, market risk, concentration risk, and loss of confidence more broadly. Although there are a number of research articles addressing these topics with respect to designated CCPs or OTC derivatives, this working paper includes the perspective looking at U.S. futures CCPs and non-designated CCPs.

The Future of Innovation in an Inclusive Chicago

Chicago is a global hub for innovation in finance, technology, and other sectors. Yet continued innovation is not a given, and the makeup of the city’s population has not been reflected in its most innovative industries. How can Chicago’s history of innovation continue, and how can it include all residents of the city?

Law & Compliance Division Conference

Robert Steigerwald participated in a panel discussion of “CCP Risk” at the Futures Industry Association’s Virtual Law & Compliance Conference. The panel discussed CCP risk management issues, including the CCP risk whitepaper, as well as newly finalized amendments to Part 39 regulations.

What Risk Managers from NASDAQ and Options Clearing Corp Learned From the Covid-19 Crisis: Perspectives on Resilience and Challenges During the Pandemic

This episode of LaSalle Street welcomes chief risk officers from Options Clearing Corporation and Nasdaq Inc. to discuss what the pandemic is teaching us about risk management and global financial markets.

Clearinghouse Risk, Reference Rates, and Cryptocurrency with Former CFTC Chair J. Christopher Giancarlo

The Honorable J. Christopher Giancarlo was on the frontlines of the biggest issues shaping global financial markets as the 13th chairman of the U.S. Commodity Futures Trading Commission (CFTC). Known by some as "CryptoDad," Giancarlo visits LaSalle Street to discuss his reflections a year after leaving the CFTC, key issues he faced during his tenure, and emerging issues shaping the markets today. The conversation includes discussion of clearinghouse risk and the work of the Financial Stability Board, the risks embedded in reference rates, and why regulators should be investing time in the future of digital currency.

The Influence and Limits of Central Bank Backstops

By Sam Schulhofer-Wohl

In this post, I explain how central banks’ “backstop” lending facilities can influence financial conditions even when the facilities see relatively little borrowing. The knowledge that credit is available, even if at a relatively high penalty interest rate, can calm markets and encourage confidence in the economy. The availability of a backstop can also influence interest rates on private-sector transactions. However, backstops aim to support normal market functioning—not to make credit cheaper or more plentiful than what a normally functioning market would deliver.

Chicago Fed Hires Ketan B. Patel as Policy Advisor and Head of Financial Markets Risk Analysis

Patel will be responsible for analyzing the public policy implications of risks in financial markets and financial market infrastructures. The group’s research on financial market institutions, technology and infrastructure helps inform and foster stable and efficient national monetary, financial and payments systems.

Monetary Policy Implementation With an Ample Supply of Reserves

By Gara Afonso, Kyungmin Kim, Antoine Martin, Ed Nosal, Simon Potter and Sam Schulhofer-Wohl

Chicago Fed Hires Maggie Sklar as Senior Policy Advisor and Director of International Engagement

Maggie Sklar joined the economic research department as senior policy advisor and director of international engagement in the financial markets group. Sklar reports to Vice President Alessandro Cocco.

Chicago Fed Hires Vice President of Financial Markets Group

The Federal Reserve Bank of Chicago announced that Alessandro Cocco will join the economic research department on October 21 as vice president of the financial markets group. Cocco will report to senior vice president Sam Schulhofer-Wohl.


By Robert Cox and Robert Steigerwald

Non-Default Loss Allocation at CCPs

By Rebecca Lewis and John W. McPartland

Blockchain and Financial Market Innovation

By Rebecca Lewis, John W. McPartland and Rajeev Ranjan

Symposium on OTC Derivatives

Conference agenda

Symposium on Central Clearing

Conference agenda

A New Approach to Stock Market Execution

By John W. McPartland and Rebecca Lewis

2014 Derivatives Symposium

Conference agenda

The Role of Time-Critical Liquidity in Financial Markets

By Robert Steigerwald and David Marshall

2013 Derivatives Symposium

Conference agenda

What Tools Do Vendors Provide to Control the Risks of High Speed Trading?

By Carol Clark, Richard Heckinger, Rajeev Ranjan and John W. McPartland

What Is Clearing and Why Is It Important?

By Robert Steigerwald and Ed Nosal

Policymakers, Researchers, and Practitioners Discuss the Role of Central Counterparties

By Douglas D. Evanoff, Daniela Russo, and Robert Steigerwald, 2006

Meet our staff

Nahiomy Alvarez
Alvarez, Nahiomy
Senior Financial Markets Analyst
Alessandro Cocco
Cocco, Alessandro
Vice President
Ketan Patel
Patel, Ketan B.
Policy Advisor and Head of Financial Markets Risk Analysis
photo of sam schulhofer-wohl
Schulhofer-Wohl, Sam
Senior Vice President and Director of Financial Policy
Maggie Sklar
Sklar, Maggie
Senior Policy Advisor and Director of International Engagement
John Spence
Spence, John
Financial Markets Analyst
Steigerwald, Robert
Senior Policy Advisor, Financial Markets

The Financial Markets Group analyzes public policy issues in financial markets from multiple perspectives. The group applies legal, market practitioner, technological and other expertise to study challenges and risks in financial markets and infrastructures.

By communicating its findings to policymakers, regulators, industry leaders and the public, primarily through published work and conferences, the group contributes to the Federal Reserve’s mission of fostering the stability, integrity, and efficiency of the nation’s monetary, financial, and payment systems. The group has particular expertise in the derivatives markets and clearinghouses in which Chicago is a global leader.

We support a diverse and inclusive work environment where employees and stakeholders are respected, treated fairly, and given equal opportunities to perform to their fullest potential. By valuing diverse experiences, styles, approaches and ideas, we can achieve our goals, serve our stakeholders and become a higher-performing organization.

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