The dramatic market downturn has led to worries about counterparty credit risk. In the over-the-counter credit derivatives market, where bilateral deals are struck directly between trade counterparts, credit risk quality is paramount. Natasha de Terán reports on how the market is coping.
The convergence of the insurance and capital markets industries has opened up an alternative channel for insurers to raise capital, brought tangible regulatory capital benefits to the insurance industry and offered investors a source of coveted and uncorrelated exposure. Natasha de Terán explores what derivatives can bring to the table.
As write-downs hit, many banks are being left with no alternative but to raise more capital this year. Some believe that hybrid securities will be the favoured approach, others believe that market conditions will make the equity and equity-linked markets the easier route. Neil Sen reports.
After eyeing the US municipal bond market for some time, Warren Buffet, the billionaire investor at the head of Berkshire Hathaway, is launching a new bond insurance firm thanks to the troubles of the sector’s main insurers. An industry’s nightmare is an investor’s dream.