Wednesday, June 15, 2011

RBI EASES CDs NORMS, GIVES BANKS 5 MONTHS TO COMPLY

The Reserve Bank of India (RBI) has relaxed the eligibility norms for using Credit Default Swaps (CDs). Credit Default Swaps (CDs) acts as insurance for lenders in case a borrower defaults on a loan. The buyer of the cover against the loan makes regular premium payment to a counter party, which assumes the risk in case of a default.

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