Credit derivatives, an instrument that emerged around 1993-94, is a part of the market for financial derivatives. Since credit derivatives are presently not traded on any of the organised exchanges, they are a part of the over-the-counter (OTC) derivatives market. Though still a relatively small part of the huge market for OTC derivatives, credit derivatives are growing faster than any other OTC derivative, the reasons for which are not difficult to understand.
Credit derivatives are derivative contracts that seek to transfer defined credit risks in a credit product or bunch of credit products to the counterparty to the derivative contract. The counterparty to the derivative contract could either be a market participant, or could be the capital market through the process of securitisation. The credit product might either be exposure inherent in a credit asset such as a loan, or might be generic credit risk such as bankruptcy risk of an entity. As the risks, and rewards commensurate with the risks, are transferred to the counterparty, the counterparty assumes the position of a virtual or synthetic holder of the credit asset.
Our Training Experience
As trainers on specialized financial subjects such as affordable housing finance, housing microfinance, securitisation, mortgage lending, derivatives, credit-derivatives, structured finance, leasing, asset-backed financing, secured lending and microfinance, we have almost an immaculate position and reputation.
We have conducted training courses in ALL the continents of the world.
We have conducted training courses in most of the world’s leading financial centers. The list includes New York, Washington, London, Milan, Frankfurt, Luxembourg, Dubai, Singapore, Hong Kong, Johannesburg, Cape Town, Mumbai, Delhi, Kolkata, Bangalore, Chennai, Jakarta, Cairo, Amman, Istanbul, Sydney, Kuala Lumpur, Colombo, Colombia, Dhaka, etc.
We have conducted training courses for diverse groups, from a group of investors in Sydney, to a rating agency in Kuala Lumpur, to a group of lawyers in Mumbai, to a group of quants in New York, to insurance professionals in Milan, to a multilateral investing bank in Luxembourg.
In most cases, our trainings have been rated “excellent”.
We conduct a 7 days residential training course in Kolkata, India. We do several runs of this every year – we have completed 10 runs already. This training course attracts participants from all over the world.
We have had a yearlong continuing project-related training assignment with Royal Bank of Scotland’s India Development Center. This requires us to study their credit derivatives trading/risk management systems, and build a training package around the same.
We have advised on several occasions on valuation of derivatives transactions done by entities.
We have advised on legality of certain foreign exchange derivatives transactions entered into by a company with a bank – from the viewpoint of whether the transaction was conducted as a hedge.