CDOs set to get big in Japan
New accounting rules in Japan now allow synthetic collateralised debt obligations to receive the same treatment as cash bonds, which is likely to boost demand for such products. Rahul Jhaveri reports
New accounting guidelines relating to synthetic collateralised debt obligations (CDOs) have stirred excitement among the dealer community, who expect them to give a major boost to the market. Dealers unanimously say they have been getting more enquiries from Japanese investors about synthetic CDOs since the Accounting Standards Board of Japan (ASBJ) released the new rules in April, and some private transactions have gone through as a direct result of the change.
The new rules are in response to
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