Paragraph 33 sets out the sixth stabilisation option (power to cancel or reduce variation margin payments). This power allows the Bank to cancel or reduce a variation margin payment (as defined in sub-paragraph (5)) that a CCP would have otherwise paid to a clearing member.
	Sub-paragraph (3) specifies that this power can only be used to recover losses incurred as a result of a clearing member defaulting and will not apply to the clearing members outlined in sub-paragraph (4).
Schedule 11: Central counterparties Part 5 – Special resolution action Power to reduce variation margin payments