The contribution to noninterest income of the non-operating mortgage derivative
asset was $2.0 million lower this quarter than the first quarter of 2015.
With so many foreign banks buying into our mortgage derivative
schemes, no other outcome was possible.
"The process of unwinding subprime mortgage derivative
swaps and other commercial derivative swaps hasn t materially improved over the last three months but is now being overlooked by investors as the banks are simply not talking about them," Dickson said.
In one form or another, the AIG and mortgage derivative
cases share characteristics that result in similar outcomes: Notwithstanding a great many records in many places, the result was not the clarity and certainty those records were supposed to ensure, but opacity, confusion, and staggeringly large financial losses.
Imagine if we had allowed the mortgage derivative
markets to do the same thing.
The first effort involves an interagency statement issued in February of this year on the proper use by banks of so-called "high risk" derivative instruments-- investments such as interest- or principal-only mortgage derivative
A third major mortgage derivative
blowup hit an $827 million mutual fund run by Piper Capital Management, a subsidiary of Piper-Jafray Companies Inc., of Minneapolis, Minnesota.
12 May 2010 - US Morgan Stanley's (NYSE:MS) CEO James Gorman said today he was not aware that the firm was under scrutiny by local federal authorities in relation to mortgage derivative
deals, as reported by the Wall Street Journal.
A high-risk mortgage security is defined as any mortgage derivative
product that has (1) an expected weighted-average life greater than eight years (i.e., "average life" test); (2) an expected weighted-average life that extends by more than four years or shortens by more than five years assuming immediate and sustained parallel shifts in the yield curve of plus or minus 300 basis points, respectively (i.e., "average life sensitivity" test); or (3) an estimated change in the price of more than 16 percent due to an immediate and sustained parallel shift in the yield curve of plus or minus 300 basis points (i.e., "price sensitivity" test).
Yiu, who will be trading mortgage derivatives
, has previously worked at Deutsche Bank for nine years.
Credit Suisse was not gutted by the 2008 crash, unlike UBS, which lost $50 billion in failed bets on toxic credit and mortgage derivatives
on Wall Street.