A deluge of credit derivative product companies is set to hit the market over the next year and some are looking to attain banking licenses, said panelists discussing CDO innovation. More than a dozen vehicles are in the pipeline in both Europe and the U.S. "There is a flurry of creation on this front," said Hubert Le Liepvre, deputy head of the structured credit group at SG Corporate & Investment Banking.
CDPCs are highly-rated counterparty vehicles which take on risk in the senior part of the capital structure. "[A dozen] is a high number of new entrants into the correlation business," said Anne Wrobel, managing director at monoline Financial Security Assurance. She also noted wryly that CDPCs are "bad news" for monolines because they offer almost the same service but at lower prices.
