Investors cheer Fed guidance on bank credit risk transfers
Institutions say clarification of regulations could jump-start US market
Investors believe guidance issued last month by the US Federal Reserve could double the size of the market for bank credit risk transfers and drive up returns for the firms buying them.
Over the past five years there has only been a trickle of CRT transactions issued by US banks; and since 2022, the New York Fed has significantly delayed the approval of credit-linked notes (CLNs) altogether, including for global systemically important banks. However, on September 28, the Fed released a short FAQ
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe
You are currently unable to print this content. Please contact info@risk.net to find out more.
You are currently unable to copy this content. Please contact info@risk.net to find out more.
Copyright Infopro Digital Limited. All rights reserved.
As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (point 2.4), printing is limited to a single copy.
If you would like to purchase additional rights please email info@risk.net
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (clause 2.4), an Authorised User may only make one copy of the materials for their own personal use. You must also comply with the restrictions in clause 2.5.
If you would like to purchase additional rights please email info@risk.net
More on Investing
Podcast: Alexandre Antonov turns down the noise in Markowitz
Adia quant explains how to apply hierarchical risk parity to a minimum-variance portfolio
Bank of England mustering unit to model system-wide stresses
Permanent team at UK supervisor will work on buy- and sell-side interactions
Why vol markets shrugged off Nvidia rout
Gamma, autocalls and stock dispersion helped prevent a broader market meltdown
Reverse dispersion gains traction as implied spread jumps
Inverted strategy on Euro Stoxx 50 gains popularity for profit-taking and correlation play
Why JP Morgan’s Santos wants to make bad news travel fast
Asset management CRO says sharing information early holds the key to avoiding surprises
Housing price diffusion study offers lessons for quants – Bouchaud
Patterns seen in how heat spreads also show up in markets, research shows
Yen rise spurs Japanese rates market surge
Traders are moving on an expectation of increased yen volatility in 2025
Diversification of LDI liquidity buffers sparks debate
Funds using credit assets to top up collateral waterfall, but some risk managers are sceptical
