Liquidity crises are a recurring feature of every financial market and in 2007 it was the turn of the credit markets.

The ‘Credit Crunch’, also known as the sub-prime mortgage crisis, banking crisis or liquidity crisis, exhibits similarities to and also differences from previous crises.  The market impact is substantial, with losses from sub-prime loans and instruments structured around the loans, now estimated between 150-300 billion US Dollars (USD).

This paper explores some of the underlying factors which led to the credit crisis and identifies steps that banks can take to better manage a similar crisis in the future.

Download the Risk Transparency in the aftermath of the credit Crunch White Paper