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How counterparty credit risk management techniques have evolved

Since the collapse of Lehman Brothers in September 2008, counterparty credit risk management has assumed critical importance at both sell-side and buy-side institutions.

The failure of Lehman Brothers and near failure of several other major financial institutions have highlighted the need for more robust counterparty risk management procedures. It is no surprise, then, that financial institutions

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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…

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