Initial margin (security margin)

At the ECB, a risk control measure applied to reverse transactions, whereby the counterparty is required to provide collateral with a value equal to the credit extended plus the value of the underlying assets. – The ECB staggers the initial margins according to the duration of the credit extended to the counterparty in connection with a transaction. – See variation margin agreement, variation margin. – See ECB Monthly Bulletin of April 2001, p. 58; ECB Monthly Bulletin of May 2004, p. 81; ECB Monthly Bulletin of October 2007, p. 93 et seq. (comparing collateral arrangements at the ECB with the U.S. and Japan; many overviews).

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