Basel Report Recommends Stronger Risk Management by Firms Issuing and Investing in Special-Purpose Entities
October 2, 2009
Special-purpose entities, structures that are widely used in the MBS and ABS market, aren’t intrinsically bad, but poor management practices and a lack of transparency led to significant problems during the financial market meltdown, according to a new report on SPEs released this week by the Basel Committee on Banking Supervision. “It must be emphasized that the usage of SPE structures is...