One year after Lehman Brothers developed a credit default swap that referenced preferred securities, eight dealers have come up with a standard form of documentation for this product, which was launched in mid-March. But it might take more than having a lot of dealers involved and standard documentation to work up worthwhile interest in the product.
Bear Stearns, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, JPMorgan and Merrill Lynch collaborated with Lehman Brothers to develop the new terms. “Investors were telling us they wanted more than two dealers and market standard documentation, so in the last couple of months we’ve got together to determine what that standard documentation should look like,” says Thomas Corcoran, head of hybrid capital trading at Lehman Brothers in New York....
