For much of the past year, banks have been frantically trying to sell off unwanted stockpiles of securitised credit. Buyers have been few and far between, resulting in a pricing nosedive and a dismal parade of multi-billion dollar write-downs. The market may have gone too far. Analysts and valuation experts argue that much of this paper is actually worth far more than current prices suggest, and some investors now see a chance to make a killing. Duncan Wood reports.

It’s been a while since the world has expected anything positive from Japanese banks. But in the darkest months of 2008 they emerged as unlikely heroes for their counterparts in the west. Cash-rich yet inefficient, the megabanks of Japan are stuffed with deposits that wobbly Wall Street financiers would kill for, but does their opportunism prove their role in world finance has changed? Chris Wright reports.

With the aid of a telescope and some determined optimism, it’s just about possible to make out a silver lining to the financial crisis: if banks, investors, rating agencies and regulators collectively misunderstood credit risk and liquidity risk in the period leading up to August 2007, they will at least be a bit smarter now. Before anyone breaks out the bunting, however, it’s worth thinking about the implications of this new knowledge. Duncan Wood reports.

While politicians struggle to save the financial system from collapse, their focus has been almost exclusively on how to restore confidence and get banks lending again. The more fundamental question of what must be done to ensure that the same problems don’t reappear has been less prominent. Solomon Teague reports.

The last year has been an epic journey. At the start of 2008, already spooked markets stood at an unmarked crossroads, but it was impossible to judge which route they had taken until into the third quarter. What can those investors still standing do now? Vanessa Rossi, senior research fellow at Chatham House, London, reports.

As global default rates begin to rise from historic lows, restructuring professionals – anticipating a robust workout cycle – are becoming more apprehensive about the future. In the face of a collapse in the global credit markets one thing is certain: the coming restructuring cycle will be unlike the previous one – and perhaps anything we’ve seen before. Philip Scipio reports.

In the maelstrom unleashed by the global financial crisis, many, in their panic, have concluded that CDS are the devil’s own creation, ignoring the benefits these contracts have brought to the system. As regulators look for a scapegoat for financial market woes, is there a danger the CDS baby could be thrown out with the bathwater? Savita Iyer-Ahrestani reports.

The leveraged finance industry is facing a structural change as the market shrinks with the permanent departure of many CLO investors. Participants say it is time the market returns to more conservative lending and less aggressive structures, reports Han-Nee Tay.

Six months ago Islamic finance barely registered on the radar of many in the financial system. But financial complexity and unfettered markets – once the path to great rewards for those able to exploit them – have proved their own worst enemy, making simplicity all the more appealing. This has paved the way for the advancement of Islamic finance, as Savita Iyer-Ahrestani reports.

Covered bond issuance has ground to a halt in a sign that the credit contagion has left no haven truly safe. Even as US authorities encourage issuance to provide some reprieve for mortgage lenders, the typically active European market shows little signs of life. Han-Nee Tay reports.