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Loading... Back from the Brink: Lessons from the Canadian Asset-Backed Commercial Paper Crisisby Paul Halpern
None No current Talk conversations about this book.  BrianEWilliams | Dec 12, 2016 |  no reviews | add a review
"As global markets toppled during the 2008 financial crisis, the Canadian market for non-bank asset-backed commercial paper (ABCP) seemed on the verge of collapsing. Fueled by a top rating from DBRS, ABCP had found its way into the portfolios of some of Canada's most sophisticated investors as well as vulnerable retail investors who didn't know what they were holding. The failure of the $32 billion market could have tipped Canadian and foreign credit default swap markets into chaos if it weren't for the swift actions of a few powerful asset holders. Collectively, through the Montreal Accord and led by veteran Canadian lawyer Purdy Crawford, they managed to hold the Canadian ABCP market back from the brink of collapse by crafting a complex and innovative solution. Back from the Brink goes behind the scenes of the ABCP crisis to examine how a solution was reached and lessons learned that could prevent or mitigate future crises. The authors also examine the imaginative use of the Companies' Creditors Arrangement Act and describe the roles played by the banks, the major investors, rating agencies, and the financial regulators in the crisis's origins and conclusions. Back from the Brink holds important lessons for anyone interested in Canadian law, the future of complex investments, and Canada's capital markets."-- No library descriptions found. |
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 Google Books — Loading...GenresMelvil Decimal System (DDC)658.15Technology Management and auxiliary services Management Of Corporate Finance Financial ManagementLC ClassificationRatingAverage: (2.5)
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Wikipedia in English
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Similarly there was little about the large role the late Purdy Crawford played in the negotiations. I suspect that most of the key players are not yet willing to talk about the process, or are constrained by confidentiality obligations.
The solution to the collapse was not a market bailout by the government despite pressure on the federal government to come to the "rescue" of the players. In the end the government gave limited support to a financing facility, for which it was compensated. The lesson (to use the authors' term for the rest of the workout) is that a market can save itself with motivated negotiations where everyone is willing to compromise, rather than face further losses through litigation in the courts.
It's incredible that large institutional investment managers were more or less asleep at the switch with respect to the non-bank ABCP's. The authors' noted that "some heads rolled".
There was no biographical information about any of the 4 co-authors and without additional research about them, readers are left to wonder about their qualifications.
There's not a lot written about the 2007 ABCP market collapse yet. The press coverage at the time may be the largest body of work right now. This book is a good first step to increasing the body of information. (