Bringing down the house

The deeper you delve into the causes of the US subprime mortgage crisis – or market "correction" as some prefer to call it – the more convinced you become that operational risk problems were a central factor. Even though credit risk issues play a significant role, the fact that operational risk processes and procedures were relaxed or manipulated certainly contributed to the scale of the problem.

Subprime mortgages are loans secured on real estate offered to consumers with low credit scores, mos

To continue reading...