Hints and tips:
...Under Dodd-Frank reforms that took effect in 2015, sponsors of a deal need to retain an interest of at least 5 per cent of the aggregate credit risk of the assets they’re turning into securities....
...The good times for FICC ended after the bursting of the mortgage bubble, bringing about the demise of Bear and Lehman. Tough new regulations on trading were drafted....
...Shares in JPMorgan were little changed by the close of trading in New York at $52.51, after the bank sought to provide clarity on its legal situation....
...In the 1980s, as a bond trader at investment bank Salomon Brothers, Ranieri had played a crucial role in developing the very concept of mortgage-backed securities....
...Lehman tried to shore up its defences this year, securing a $2bn credit line from its banks on March 14 – the Friday before the Fed-engineered sale of Bear Stearns to JPMorgan Chase....
...The cashflow from a portfolio of mortgages could be spliced into a variety of securities with different interest rates, appealing to a wide range of buyers....
...Similarly, when the Fed stepped in to prevent the implosion of Bear Stearns in March, sentiment stabilised for a period....
...It is a big prime broker, providing funding and back-up for hedge funds. It is also one of the biggest traders in mortgage-backed securities....
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