  We show how the cost of funding the collateral in a particular set up can be
equal to the Bilateral Valuation Adjustment with the "funded" probability of
default, leading to the definition of a Funded Bilateral Valuation Adjustment
(FBVA). That set up can also be viewed by an investor as an effective way to
restructure the counterparty risk arising from an uncollateralized transaction
with a counterparty, mitigating or even avoiding entirely the additional
capital charge introduced by the new Basel III framework.
