Financial Times
The Financial Times looks at the new business of collateral transformation, which many banks hope will boost profits at a time when new regulations and competitive pressures will hurt balance sheets. However collateral transformation – which involves turning relatively risky assets into ostensibly safer ones – is already capturing the attention of regulators.
According to GreySpark, this not a new idea, it’s a new way of packaging, with speculation that this business will look like repo business. They point out that this going to end up with a new industry built around the regulations that may unintentionally make where the risk actually lies less transparent.
