FIN 800 Lecture Notes - Lecture 7: Credit Default Swap, Reputational Risk, Sovereign Default
Document Summary
Irrational compensation practices not linked to long-term profitability: growing perception by the public of clever crooks and greedy fool", great deal of work to regain reputation. Peter kurer, supervisory board chairman of ubs ag we shouldn"t fool ourselves. We can"t pretend that there has been no reputational damage. Experience says it goes away after two or three years". Rise in private client withdrawals was at peak during crisis severe reputational damage to the world"s largest private bank o. Surpassed in assets under management by bank of america. Surveys available empirical research on the impact of reputational losses from accounting losses o: governance and managerial implications. Financial services are special collection of businesses o o. Problems are costly and trigger serious external costs. Capital markets and institutional asset managers have taken a greater portion of the intermediation function from banks. Insurance activities conducted in the capital markets compete with classic reinsurance functions: credit default swaps, weather derivatives.
