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Credit risk

Anglo-Irish CDS widen on buyback plans

The cost of credit protection on Anglo Irish Bank soared this week, rising to 679.1 basis points (bp) from 628.9 bp on July 3, as the bank announced plans to buy back billions of pounds and euros in Tier 1 and Tier 2 securities.

Damage limitation

Efforts are under way to formalise the resolution process for collateral disputes, while other initiatives are planned to improve processes for posting collateral, valuation and margin practices. What are the challenges to meeting these targets? Ryan…

The sovereign guarantee

Even in an era of government-backed banks, it is clear that investors do not equate a public stake with investment security. Those looking for watertight investments have been left with two options - structured deposits or collateralised plans. Will…

Counterparty maze

Regulators in the US and Europe are evaluating the concept of a central trade repository for over-the-counter derivatives as a means of increasing transparency and allowing better detection of systemic weaknesses. But will they be able to overcome the…

The shock of the interaction

Banks have long talked about enterprise risk management, but many have historically measured risk types separately and aggregated the results. The financial crisis has highlighted that credit and market risk are closely linked. What are the challenges to…

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