Despite fears that regulators around the world would act to curtail securitisation severely in the aftermath of the collapse of Enron, WorldCom, and Parmalat, the securitisation industry has witnessed what can only be described as relentless innovation. Securisation remains one of the most important means for financial institutions to diversify their funding, transfer credit risk and manage solvency requirements. This volume, the second in a series focusing on the latest innovations in the global securitisation industry, provides advisers with detailed guidance on key structural and legal issues of innovative securitisations, as well as describing the most recent developments in the accounting and risk-capital treatment of securitisation transactions. The contributors represent a wide range of expert participants in the design, execution, and regulation of securitisation transactions. Among the critical features of contemporary securitisation covered are the following: project finance CLOs; securitisation of equity risk; securitisation of commodity risk through commodity trigger swaps; the convergence of structured credit and securitisation markets; innovation in RMBS: negative equity transactions; innovation in CMBS: A/B structure new markets in Europe, Japan, and Islamic countries; catastrophe risk securitisation; effect of recent US bankruptcy legislation on synthetics; microfinance loan securitisation in emerging markets; public sector securitisation; securitisable intellectual property; application of accounting standards in a rapidly changing environment, and updated analysis of Basel II. The practical perspective of the contributions, combined with the extensive use of case studies of key transactions, should make this volume an invaluable resource for lawyers as well as legal and business academics interested in the very latest developments in the global securitisation markets.

Consumer behaviour is rapidly trending towards the use of digital devices as instruments through which to transact day-to-day business. This original and timely book shows how this trend creates new opportunities not only for retail consumers but also for financial service providers, regulators and central banks. The author offers a comprehensive overview of these opportunities and their countervailing legal and regulatory challenges. The author describes and analyses in unprecedented detail the application of digital financial innovation (FinTech), and some of its core manifestations, including virtual currencies, Blockchain and distributed ledger technologies to the delivery of financial services, in areas such as: – payments; – securities clearing and settlement; – central banking; – real-time access to financial information; – instant completion of core financial transactions; – data validation and reconciliation processes; and – digital contracting (smart contracts). Also clarified are the legal and other barriers to be overcome – including cybersecurity and risks to privacy – before any widespread adoption of digital innovation in the highly regulated financial sector context can occur. As an informed assessment of the legal merits and risks of technological innovation for financial service providers and central banks, and as a contribution to establishing a conceptual framework within which to analyse and better understand the applications of digital innovation to the financial sector, this practical work is bound to be welcomed by legal practitioners and legal scholars alike with an interest in financial services. Policymakers and regulators will also appreciate its guidance on how to temper the less benevolent aspects of FinTech with targeted, risk-focused regulation, so as to promote innovation and preserve the potential benefits for financial markets and their participants alike.

It is now widely recognized that an uncontrolled "derivatives revolution" triggered one of the most spectacular worst-case scenarios of modern times. This book - the most cogent legal analysis of the subject yet to appear in any language - lays bare the core role played by the failure to adequately regulate derivatives in the financial crisis of recent years. The author's insistence that derivatives must be viewed not as profit-seeking investments but as risk management tools - and his well-grounded prescriptions to ensure that they are regulated in that way - sheds clear light on the best way for companies, financial institutions, and hedge funds to move forward in their use of these useful but highly hazardous instruments. This book clearly shows how such elements as the following fit into the legal analysis of derivatives, and how proper regulation will preserve their usefulness and economic value: ; derivatives allow for the most efficient and cost-effective risk fractioning, hence risk taking, techniques ever conceived; derivatives allow for all measurable and identifiable risks that may exist in modern finance; the ability to isolate risks and insure against risk exposures is the key to the very survival of modern financial markets; risk buyers effectively take on financial exposure to various types of risk while hedgers unload unwanted exposures; derivatives allow domestic investors to acquire exposure to foreign markets without the necessity of dealing with foreign laws, foreign investments, currency exchange, or foreign fiscal regimes; derivatives increase social welfare by making it easier and less expensive to carry out many types of financial transactions; derivatives allow governments to insulate, manage, hedge or concentrate risks deriving from financial, meteorological, and even geopolitical exposure; and derivatives allow radical changes to financial and risk structure to be performed silently and rapidly. To the question: how do we ensure that a company trading derivatives is regulated effectively? this work offers a clear and convincing answer. The author's detailed recommendations for regulatory and corporate governance measures are designed to prevent excessive risk taking, the emergence of rogue traders, and ultimately the emergence of another systemic disturbance caused by chains of derivatives-related losses.

Securitization--once a fairly straightforward means of offering collateral for investment--has mushroomed into a massively complex area of financial practice. The central role occupied by such risk-distributing products as collateral debt obligations (CDOs), credit default swaps (CDSs), collateral loan obligations (CLOs), and credit derivatives has given rise to one of the most crucial inquiries of our era: Is the financial collapse that threatens the world financial system due merely to rogue traders? Or is there something in the derivative idea itself that spells inevitable disaster? Most important, can we isolate the truly productive aspects of securitization and learn to recognise pitfalls in advance? As always in such ideational minefields, it is the legal practitioners who are expected to provide guidance to distressed investors and asset dealers. Hence this vital new book. Written from a distinctly practical point of view by Jan Job de Vries Robb� with contributions from Paul Ali and Tim Coyne--all three leading authorities with extensive experience as counsel both in-house and in private practice, in addition to sterling academic credentials--the book sheds clear light on every aspect of today's securitization techniques, including welcome guidance on the following: ; keeping track of exposure to the CDO market; and evaluating such emerging asset classes as commodity risk, microfinance, and project finance risk. In the course of the analysis the book proceeds from the relevant framework and guiding legal principles, through key risks and building blocks in securitization transactions, to the various product classes and sub-classes and their differences and common denominators. Non-credit risk and niche products (such as fund and insurance securitization) are also covered. The final chapters are devoted to the applicable rules as laid down in Basel II and International Financial Reporting Standards.

As opposed to a bank bailout, a bail-in occurs when creditors are forced to bear some of the burden of bank failure. The principal aim of this restructuring tool is to eliminate some of the risk for taxpayers. Several jurisdictions, including Switzerland and the European Union (EU), have adopted legal provisions regarding the bail-in, but until this, book literature on its implementation has been scarce. Offering a detailed and comparative analysis of EU and Swiss law relating to bail-ins and their economic impact, this is the first book to provide in-depth coverage of this new method of dealing with the failure of systemically important banks. In its contextualisation and analysis of the bail-in resolution tool, the book identifies and discusses the legal and economic issues that arise, including such aspects as the following: – the legal and economic properties of bail-in capital; ? the regulatory standard on total loss-absorbing capacity (TLAC) issued by the Financial Stability Board (FSB); ? the scope and sequence of liabilities subjected to bail-in; ? the legal position of stakeholders affected by a bail-in; ? strategies and procedures for the implementation of a bail-in; ? the limited circumstances under which government rescues should be available; and ? cross-jurisdictional issues and aspects of international cooperation. As well as case studies and analyses of legal issues with particular reference to Swiss law and the European Bank Resolution and Recovery Directive (2014/59/EU), the author applies economic concepts to the analysis of the law. International developments, in particular standards issued by leading regulatory bodies, are also covered. This book will be welcomed by legal practitioners working in banks and in banking regulation and by policymakers seeking information on the practical issues involved. As a detailed analysis of a new and highly significant development in banking law, it will also be of great interest to academics.

The expansion of the fund industry has been one of the most notable trends in the financial markets of recent years. Not only has the demand for funds among EU investors grown, but both the number and types of investment funds also continue to increase. Since investment funds available in the EU can be established both inside and outside the EU, they may be subject to different investor protection regulations, depending on where the fund is located. Accordingly, different levels of investor protection may exist between investors investing in EU funds and investors investing in non-EU funds, including US funds. This book investigates whether there is a level playing field between EU investors investing in EU funds and EU investors investing in US funds and if not, if there is a legal basis in current EU law for the EU regulator to adopt additional investor protection rules applying to investment funds. The analysis considers the basic characteristics of investment funds, how they function in practice, and how they are regulated relating to investor protection issues. Factors examined in depth include the following: – features of funds most relevant to the protection of retail investors; – operational structure, investment strategies, fee structure, and legal structure of funds; – internal control systems; – transparency and disclosure rules; – conduct of business rules; and – depositary monitoring rules. The author examines relevant EU directives and rules and the particular remit of each, as well as US law applying to investment funds that are active in the EU. Case law and relevant literature in the field is also drawn on. As an assessment of the current degree of protection applying to funds that are available to EU retail investors – as well as an up-to-date overview of regulatory requirements and procedures concerning the protection of EU investors in investment funds – this book is unsurpassed. Especially valuable is the closing discussion about whether the EU regulatory system provides for a level playing field of protection for EU retail investors, and if not which additional rules can be adopted by the EU regulator in this area. Lawyers and other professionals in all areas of law and policy concerned with investment and finance will find this book of great value.

A thriving capital market, one that not only brings investment funds into a country but also distributes profits in a transparent manner, is essential for any economy, especially a rapidly developing one such as Saudi Arabia. Already a key player on the world stage, the Kingdom is going through a major planned economic transformation and diversification. In particular, a robust and transparent capital market, with a high level of integrity and sound enforcement, is well on the way to fruition. This book is the first in English to analyse and evaluate the roles of economic planning and a capital market in Saudi Arabia’s economic modernization. In the process of examining the level of transparency and fairness in Saudi Arabia’s capital market, the author provides detailed information and analysis of such issues and topics as the following: – market disclosure rules; – insider trading laws; – gaps in enforcement; – dispute resolution; – role of securities agencies; – Saudi Arabia’s position in international organizations; and – repercussions of the 2006 Saudi stock market collapse. The author draws on a wide range of sources in both English and Arabic, and concludes with well-grounded proposals for appropriate judicial, administrative, and enforcement policies. Investors, their management and attorneys, and other advisors with an eye on trade development in the Middle East will derive great benefit from the current and detailed information in this book. Lawyers and policymakers will discover all they need to know about the Saudi capital market, its developing trends, and applicable laws.