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Consulting
Services
Tavakoli
Structured Finance, Inc. (TSF) assists
clients in maximizing the value of structured financial
products and in using structured finance to reduce
funding costs. TSF
develops opportunistic hedging and revenue strategies. TSF
also aids financial institutions in negotiations
to quickly achieve satisfactory financial outcomes
without
legal
battles.
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- Securitization and Special Purpose Entities
- Securities
& accounting fraud, misrating
- Derivatives
including credit derivatives
- Repos
and Total Return Swaps
- Legitimate
and illegitimate uses of structured financial products
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Corporate
Finance
- Mergers,
Sales, Acquisitions
- Risk
Management – Structured finance, securitization and
derivatives issues
- Bank
Balance Sheets - and hidden risks due to structured finance
activity
Securitization
and Collateralized Debt Obligations (CDOs)
- Investors - Fair
value and structural protection. Remedies for downgraded
or distressed deals.
- Securities – Credit
linked notes, convertible bonds, mortgage backed securities,
bonds with imbedded derivatives
- Special
Purpose Entiities, SPEs, Special Purpose Vehicles, SPVs – Structured
finance applications including accounting issues
Credit
Derivatives and Traditional Derivatives 
- Credit
Derivatives – Language, risk management, and value
considerations of credit default swaps and total return swaps.
- Traditional
Derivatives – Hedging options for interest rate
and currency risk.
See
the news section
for recently published articles by Janet Tavakoli.
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Definition
of Structured Finance
Structured
finance is a generic term referring to financings more complicated
than traditional loans, vanilla bonds and common equity. Relatively
simple transactions that lower corporations' funding costs
by converting floating rate obligations to fixed rate obligations
(or the opposite) through the use of interest rate swaps are
traditionally considered structured finance transactions. Financial
engineering involving special purpose entities is also considered
a part of structured finance. Extremely complicated leveraged
products such as constant proportion debt obligations (CPDOs)
and complicated securitizations such as collateralized debt
obligations of collateralized debt obligations (CDO^n) are
also included in the definition of structured finance.
Key motivations for using structured finance include lowering funding costs,
changes in debt and equity composition of the balance sheet, taking companies
public or private, freeing up balance sheet capacity, monetizing balance
sheet assets, financing assets, regulatory capital arbitrage, sheltering
corporations from operating liabilities, tax management, financing leveraged
buyouts, poison pill takeover defenses, hedge fund speculation, accounting
rule compliance and leverage. The structures may address several issues
at once including risk transfer, accounting, taxation, bankruptcy and credit
enhancement.
Source:
Tavakoli, J. Structured Finance & Collateralized Debt
Obligations, John
Wiley & Sons, 2003, 2008.
Definition
of Credit Derivative and Credit Default Swap
Definition of
Total Return Swap
"Alternative" Finance
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