Credit Derivatives Training

60 hours/3 months access/Instructor Supported

Overview
The development of credit derivatives is a logical extension of two significant developments: securitization, and derivatives. Credit derivatives are contracts that transfer an asset's risk and return from one counterparty to another without transferring ownership of the underlying asset. The choice of the contract depends upon the goals a financial institution is looking to achieve. The global market for credit derivatives is still quite small compared with other derivatives markets, but it is growing rapidly. A number of impediments could slow the growth of this market, most of which revolve around the complexity involved in pricing and documenting these transactions.

After completing this course you will be able to:

• Accounting and control considerations
• Why deals are structured in certain ways
• The importance of risk management and control matters
• The impact of E-commerce on credit derivatives trading
• Taxation issues arising from credit derivatives
• Regulatory risks surrounding credit derivatives transactions

Credit Derivatives
Time taken to complete each Course: Two - Three hours

1. Overview to Credit Derivatives

·         Objectives

·         Introduction

·         Types

·         Applications

·         Other Issues

2. Credit Risk

·         Objectives

·         Introduction

·         Measuring Credit Risk

·         Managing Credit Risk

·         Credit Pricing

·         Models for Credit Risk

·         Application of Credit Derivatives

3. Credit Rating Dynamics

·         Objectives

·         Introduction

·         Approaches

4. Emerging Markets

·         Objectives

·         Introduction

·         Why Credit Derivatives

·         Risks

·         Credit Derivatives Structures

·         Total Return Products

·         Credit Default Risk Products

·         Credit Spread Risk Products

·         Structured Notes

·         Convertibility Products

5.  Classic Credit Derivatives

·         Objectives

·         Introduction

·         Credit Guarantees

·         Revolving Credit

·         Repos

·         Asset Swaps

6. Total Return Swaps

·         Objectives

·         Basics

·         Benefits

·         Usage

7. Structured Notes

·         Objectives

·         Credit Linked Notes

·         Structured Notes

·         Types

8. Repackaged Notes

·         Objectives

·         Concepts

·         Repackaging Vehicles

·         Repackaging Strategies

9. Credit Portfolio Securitization Structures

·         Objectives

·         Introduction

·         CLOs and CBOs

·         Key Areas of Risk

·         Other issues

10. Case Studies for CPSS

·         Objectives

·         Rose

·         Nations Bank Commercial Loan Master Trust

·         CORE

·         Glacier

·         Bistro

·         Eisberg Finance Ltd.

·         C Star

11. Credit Default Swaps

·         Objectives

·         Introduction

·         Main Features

·         Pricing Credit Default Swaps

·         Uses of Credit Swaps

·         Types of Credit Default Swaps

·         Disadvantages of Credit Swaps

12. Case Studies for Credit Default Swaps

·         Objectives

·         Bank Synthetic Securitization

·         Single Name Credit Risk Transfer

·         H.K Synthetic Deal

·         The Fourth Promise Securitization Programme

13. Credit Spread Options

·         Objectives

·         Basics

·         Credit Spread Puts

·         Credit Spread Calls

·         Credit Spread Collars

·         Credit Spread Forwards

14. Bank and Institutional Applications

·         Objectives

·         Introduction

·         Credit Portfolio Management through Credit Derivatives

·         Examples

·         Portfolio Credit Default Swaps

·         BISTRO (Broad Index Secured Trust Offering)

15. Investor Applications

·         Objectives

·         Introduction

·         Investor Applications

·         Examples

16. Corporate Applications

·         Objectives

·         Introduction

·         Main Applications of Credit Derivatives

·         Present Users of Credit Derivatives

17. Pricing Credit Derivative Instruments

·         Objectives

·         Introduction

·         Pricing Default Swaps

·         Asset Swap Approach

·         Pricing Credit Spread Options

18. Risks Involved In Credit Derivatives

·         Objectives

·         Introduction

·         Credit Derivatives Risks

·         Various Risks- an in-depth Look

·         Risk Management Principles

·         Interactive Game

19. Documentation

·         Objectives

·         Introduction

·         ISDA Master Agreement

·         Credit Definitions

·         Some more definitions

·         Documentation for different
transactions

20. Regulations

·         Objectives

·         Introduction

·         Unfunded Credit Derivatives

·         Funded Credit Derivatives

·         Mismatches

·         Banking and Trading Book

·         The New Capital Adequacy

·         International Bank Regulations

21. Legal Issues

·         Objectives

·         Introduction

·         General Legal Issues

·         Documentation

·         Confidentiality

·         Netting

·         Gaming

·         Securities and Insider Dealing

22. Accounting

·         Objectives

·         General Principles

·         Accounting for Credit Derivatives

·         Example-Total Return Swaps

·         Example-Credit Default Swap

23. Taxation

·         Objectives

·         Total Return Swaps

·         Default Swaps

·         Credit Linked Notes % Spread Options

JOB AIDS

·         Financial Calculators

·         Disclosures

·         Regulations

·         Global Best Practices

·         Policy Templates

·         Credit Derivatives Benchmarking Data

Calculators in Credit Derivatives
1. Enhancing return on Regulatory Capital
2. Credit Spread Options
3. Total Return Swaps
4. Option Pricing Model
5. Asset Swap approach to pricing
6. Pricing default swap using term structure

Elearning Features

ProTrain, in partnership with Kesdee, offer state-of-the art simulated learning environment.  Exhaustive theoretical material supplemented with contemporary case studies

Learner friendly courses with:

>          Formulae, definitions and concise summaries

>          Interactive simulations

>          Solved examples, practice exercises and quizzes

>          Mock exams from proprietary database

>          Timed tests in exam format

>          Personalized results for self assessment

>          Glossary, FAQs, Pocket Reference

>          Valuable reference extracts

Other features include :

>          E-mail subject-matter expert

>          Online with 24x7 customer support