All shook up

Counterparty credit concerns have been brought to the fore following the collapse of Lehman Brothers, a major issuer of structured notes. Dealers say clients will look more than ever at the credit risk of the issuer. How will this change the dynamics of the structured products market? By John Ferry


The kaleidoscope has been shaken and the pieces of the structured products market are still in flux. Where those pieces fall, and how the market will look in future, has still to be determined. One thing is certain though: henceforth, investors in structured notes will be much more conscious of the risk of default of the institution issuing the product.

Not so long ago, a potential buyer of a structured note might have looked at the front page of a marketing brochure, seen the words 'principal

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 or view our subscription options here:

You are currently unable to copy this content. Please contact to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to View our subscription options

Credit risk & modelling – Special report 2021

This Risk special report provides an insight on the challenges facing banks in measuring and mitigating credit risk in the current environment, and the strategies they are deploying to adapt to a more stringent regulatory approach.

The wild world of credit models

The Covid-19 pandemic has induced a kind of schizophrenia in loan-loss models. When the pandemic hit, banks overprovisioned for credit losses on the assumption that the economy would head south. But when government stimulus packages put wads of cash in…

Most read articles loading...

You need to sign in to use this feature. If you don’t have a account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here