 "RBI, reserve bank of india")
The Reserve Bank of India (RBI) has unveiled draft guidelines on credit default swaps (CDS). In the past too, the RBI has tried to launch a comprehensive CDS product but it never really took off. Here’s a look at why that was the case and what has changed now.
What is a credit default swap (CDS)?
It is a form of insurance that a bond investor buys against potential defaults by a corporation. The seller of the CDS is not necessarily an insurance company and the contract can be written (issued) by any permitted regulated financial entity, mainly banks. If
