Awards for Excellence 2015

Awards for Excellence 2015

View the results now

Awards for Excellence 2015

Awards for Excellence 2015

Banker of the year

Credit default swaps: Monolines face litigious and costly endgame

Any discussion of a CDS counterparty default has to include the monoline guarantors.


A bum wrap
Notional CDS bought from monolines 03 –2008 Write-down
Merrill Lynch $18.8bln $538mln (Q4 2007) and $800mln (Q1 2008)
Citi $10.5bln $1.5bln (Q1 2008)
CIBC $7.9bln $4.7bln
RBS $12bln $4.4bln
Crédit Agricole $9.9bln $3.9bln
UBS $24.6bln $2.6bln
Société Générale $11bln $1.6bln
Source: Standard & Poor’s

Credit default swaps: On dangerous ground

These firms have lurched from one downgrade to another as the implications emerge of their exposure not only to sub-prime ABS CDOs but more recently to guaranteed investment contract (GIC) funds. Any list of counterparties at risk of default has to include several big monoline names. "All monolines that have been significantly involved in structured credit will become effectively insolvent," is the bleak prognosis from Andrea Cicione at BNP Paribas.

What does this mean for their outstanding CDS? Most of...


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SELECTED CHAPTERS

Transparency in the FX industry

Redefining Conduct

Tectonic Shifts

Growth Currency

Looks Can Be Deceiving

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