Death by CDO
Bank Thai has suffered more than most Asian financial institutions from investments in collateralised debt obligations, almost going bankrupt as a result of bets on these instruments. How did matters get so out of hand? By Kathleen Kearney
Bank Thai, born in the aftermath of the 1997/1998 Asian financial crisis, struggled to compete in the economic and political turmoil of modern Bangkok. Despite government initiatives to strengthen its balance sheet, the lender remained one of the smallest commercial banks, with shareholders' funds of 7.75 billion baht ($231 million) and total assets of 224 billion baht. In an attempt to boost earnings, Bank Thai invested in a variety of structured credit instruments, a strategy that would
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