Retail credit innovations

Australia’s retail market could become the most active investor base for sophisticated credit derivatives products, but bankers warn that the new market could backfire if issuers are not careful, writes Mia Trinephi

Between retail investors looking for higher returns on their investments and banks looking to expand their investor base for derivatives structures, retail credit derivatives products look like the best of two worlds. But bankers caution that if not walked carefully, the new playing field could turn into a minefield.

The search for yield has been a predominant theme among global investors over the past 18 months, and Australia’s retail market is no exception. With the country’s equity