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Investors, the Securitization of Bad Loans, and the Probability of Default

  • Dimitris N. Chorafas
Chapter

Abstract

As reported in a New York Times article, Citibank, a major lender to Enron, apparently protected itself from a significant portion of its Enron’s credit risk by passing it on to investors in credit-linked bonds. What the article did not mention, however, was that Citibank accomplished this risk transfer through an innovative transaction that combined credit derivatives and insurance with traditional securitization.1

Keywords

Capital Market Institutional Investor Credit Risk Credit Default Swap Trade Credit 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Notes

  1. 2.
    D.N. Chorafas, Operational Risk Control, London and Boston, Butterworth-Heinemann, 2003.Google Scholar
  2. 3.
    D.N. Chorafas, Credit Derivatives and the Management of Risk, New York, New York Institute of Finance, 2000.Google Scholar
  3. 7.
    D.N. Chorafas, Alternative Investments and the Mismanagement of Risk, London, Euromoney, 2002.Google Scholar
  4. 8.
    Dimitris N. Chorafas, New Regulation of the Financial Industry, London, Macmillan, 2000.CrossRefGoogle Scholar

Copyright information

© Dimitris N. Chorafas 2004

Authors and Affiliations

  • Dimitris N. Chorafas

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