Central banks are worried about structured credit. That was the stark message coming from a central banker panel discussion on financial stability and structured products at the Global ABS conference in Barcelona today.
David Wall of the Bank of England said there were a number of reasons why structured credit is on the BoE’s radar.
Primarily, the ‘originate and distribute’ model is a cause for concern. “It means there is less attention paid to fundamental credit assessment,” says Wall.
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