In principle, a foreign exchange transaction settled on a PvP basis is a self-collateralising transaction. In addition, various risk management measures insure CLS against any possible losses and thus possible illiquidity or insolvency. For that reason, in the event of a participant defaulting, CLS normally has sufficient funds to compensate the counterparties affected by the default. There is still a possibility, though, that these credit balances will just not be available in the currencies that the counterparties are expecting. In order to obtain the corresponding currencies, within 20 minutes CLS can use what are known as liquidity providers23 to exchange the balances it does hold by means of a swap against the currencies it needs. To this end, liquidity providers hold collateral in order to obtain short-term liquidity from central bank facilities. The liquidity providers are