Bank Contingency Financing: Risks, Rewards, and Opportunities

In recent years, banks have greatly increased their reliance on contingency financing. Shows bankers how to minimize their risk and maximize their profits when dealing in these new markets. Contingency items (also called off–balance–sheet items) are agreements made by banks in which, for a fee, the bank undertakes to act as an intermediary, guaranteeing a transaction between other parties. Zamora explains the various types of contingency financing, including swap transactions, forward rate agreements, bankers′ acceptances, and standby letters of credit. Each topic is illustrated with a case study. covers all aspects of contingency financing and places them in the context of the bank′s overall financial structure.

Spis treści:
THE DEVELOPMENT OF CONTINGENT ASSETS.
The Risks of Overexposure.
Reasons for Growth.
CONTINGENT ASSETS DERIVED FROM TRADITIONAL INSTRUMENTS.
Standby Letters of Credit.
Risk Participations.
THE RISE OF NEW PRODUCTS.
Swap Transactions.
Futures and Options.
Equity–Linked Issues.
CONTINGENCIES AND THE EUROMARKETS.
The Eurocurrency Market.
The Eurobond Market.
The Euronote Market.
ADDRESSING THE RISKS.
Proposals for Control and Regulation.
Final Conclusions and Recommendations.
Index.