New York Tries Taming Credit-Default Swaps.

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  • Author(s): Ng, Serena; Rappaport, Liz
  • Source:
    Wall Street Journal - Eastern Edition. 9/23/2008, Vol. 252 Issue 71, pC3. 0p. 1 Black and White Photograph.
  • Additional Information
    • Subject Terms:
      DEFAULT (Finance); SWAPS (Finance); CREDIT; INSURANCE departments; INVESTORS; BANKING industry
    • Subject Terms:
      NEW York (State)
    • Abstract:
      The article reports on the attempt by New York regulators to tame portions of the unregulated credit-default-swaps (CDS) market by requiring some sellers of CDS contracts to become insurance companies. The New York Insurance Department declared in a rule that some CDS contracts are insurance that has to be regulated by the state. The rule covers swaps bought by investors that also own actual bonds or loans referenced by the swaps. The regulation means that banks or institutions that sell CDS will have to apply for a license to be an insurance company.