Almost six years after the start of the worst financial crisis since the Great Depression, bond issuers are again exploiting credit ratings by seeking firms that will provide high grades on debt backed by assets from auto loans to office buildings considered inappropriate by rivals.
Deutsche Bank AG designed a derivative for Banca Monte dei Paschi di Siena SpA at the height of the financial crisis that obscured losses at the world’s oldest lender before it sought a taxpayer bailout.
The agency that supplies drinking water to almost 19 million Los Angeles-area residents paid $47.2 million to unwind interest-rate swaps with banks. Unlike many municipal issuers, ratepayers didn’t come away with a loss.
The U.S. Federal Energy Regulatory Commission’s probe of JPMorgan Chase & Co. demonstrates a renewed focus on market manipulation as the agency beefs up its oversight of the multibillion dollar energy-trading business.