Financial Times FT.com

BIS heralds demise of CDOs

By Paul J Davies in London

Published: April 1 2008 20:45 | Last updated: April 1 2008 20:53

The financial instrument that was one of the biggest drivers of the recent explosive growth in mortgage-related debt markets faces near-certain extinction, according to the central bankers’ bank.

The complex debt securities used to repackage the less attractive parts of asset-backed bonds are likely to disappear entirely as a result of the ongoing collapse of the credit market bubble, according to a report from the Bank for International Settlements.

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