Credit Default Swaps (CDS) are derivative instruments that allow investors protection against credit events such as downgrades of or defaults by single-name or a basket of obligors. Estimated by the Band of International Settlements to be at $32.6 trillion in December 2009, these instruments represent one of the largest and fastest growing financial product markets globally. This note is intended to introduce students to CDS, the pricing basics .....more

A recession in the U.S. economy began at the end of 2007. Concerns deepened as an epic financial crisis shattered business and consumer confidence. By the fall of 2008, the United States was in the midst of the worst recession since the 1930s, and major financial institutions were on the verge of bankruptcy. The financial crisis and recession spread around the world. Many saw a risk that the global financial system might collapse, perhaps precipitating .....more

In the competitive South Korean credit card market, a review of the past decade of HyundaiCard's marketing strategies and evaluation of anticipated possible difficulties of being a market follower revealed several challenges for senior management. Despite a tremendously successful creative business model based on customer needs, innovative products and integration of online and offline customers, the company's performance had not progressed .....more

From the 1970s onward, after the emergence of microfinance, lending for the poor started shifting from informal sources (e.g. moneylenders) to formal sources. The Grameen Bank (Grameen) led this change, primarily due to its chief executive officer (CEO) and his innovative microcredit model. On the basis of the CEO's rich understanding of on-the-ground realities, he began to experiment and modify the business model for microfinance, which, in the .....more

A member of the integration leadership team must help plan and execute the integration of Delta's information technology (IT) operations into those of Unity. He has been given a time limit of three years and has been charged with removing $60 million of expenses during the process. Half of the savings will come from reducing the number of staff whose roles have been duplicated as a result of the merger. The remaining savings will be achieved through .....more

Prashant Lakhera, senior analyst at Credit Rating Agency Limited (CRA), has been working with Deepak Ghosh, project manager of the Construction Development Board, on a report that needs to be submitted within the next few days. Because Ghosh had been acting inappropriately in front of clients, Lakhera and Gagan Vedi, the other analyst working on the report, were concerned about how this might damage the image of CRA. Shortly before the report was .....more

Paybox.net AG was the world's first mass-marketable mobile payment system. Launched in 1999 at the height of the dotcom boom, it had been steadily losing ground. The company's founder, and architect of the technology underlying Paybox, must decide if his product has a future, and if so, what the market strategy should be.

NextCard was a credit card issuer seeking to exploit the growing e-commerce market in the United States. It was founded in 1996, saw a successful initial public offering in 1999, and became an affiliate of Amazon.com, the largest online retailer. The year 2000 was a year of growth for NextCard, with the number of accounts more than trebling, to nearly three quarters of a million. However, on October 31, 2001, NextCard was placed under "new regulatory .....more

VanCity has been Canada's biggest success story in the field of community banking. The board of directors must consider whether the credit union should venture into mezzanine financing, a competitive industry in which the organization has no prior experience. The proposal is favored by a board member who feels that the credit union can re-invent itself in the marketplace by following this route. The decision is troublesome because even if it makes .....more

An assistant manager of a branch has been asked by his superior to hide documents relating to a lawsuit outside of the office until the trial is over. He does not have the best of the relationships with this superior, and so he must decide what to do.