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Financial advisory
RES5Financial Advisory Services✓The 2008 Lehman 'Minibonds' episode is cited as the standard cautionary case chiefly because it showed that:
The Minibond Notes were credit-linked notes issued by Minibond Limited, not by Lehman. Lehman Brothers entities were the swap counterparty and swap guarantor. When they filed for bankruptcy (15 Sep and 3 Oct 2008), the issuer stopped receiving swap payments and the notes defaulted. Retail holders lost heavily on credit and counterparty risks they had not understood, and the episode led MAS to tighten its suitability, disclosure and labelling rules. Source: MAS Investigation Report, 7 Jul 2009.
Attributing the losses to the underlying rather than issuer/counterparty failure.
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