This Module aims to:
- Explain the role of counterparty and the importance of professional advisers assessing counterparty financial strength in relation to structured products
- Explain counterparty due diligence metrics and considerations
- Explain what ‘credit ratings’ are, the background to credit rating agencies and the different credit ratings used
- Explain what ‘credit default swaps’ are, how they can provide an independent, market-driven measure of counterparty strength – and how CDS spreads can be used alongside credit ratings
- Explain what is meant by ‘fundamentals’ and how consideration of fundamentals can form part of a rounded approach to counterparty due diligence
- Explain the relevant of ‘Tier 1 Capital’ and ‘Tier 1 Capital Ratios’ and why these are important metrics
- Explain what is meant by a ‘systemically important’ bank and the regulatory capital adequacy requirements that apply to systemically important banks
- Highlight regulatory changes pertinent to improving the capital adequacy and financial strength of the banking sector and individual banks post the 2008 financial crisis
By completing this module, you can earn 120 minutes of CPD points.