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Glossary

Issuer Risk

Issuer Risk is the risk that the institution issuing a security, such as a bond or a structured product, is unable to meet its payment obligations. In the event of the issuer's insolvency, a partial or total loss may result, regardless of how the underlying asset has performed.

At a glance

  • Structured products and certificates are debt obligations of the issuer and are not protected by a segregated pool of assets.
  • The creditworthiness of the issuer is assessed, among other means, through credit ratings.
  • Spreading exposure across several issuers limits concentration risk.

Frequently asked questions

By reviewing the issuer's creditworthiness, distributing exposure across several issuers, and considering collateralised structures such as COSI (Collateral Secured Instrument) products. It is not possible to eliminate the risk entirely.

Part of the topic

AMC & Structuring

Sources: Swiss Structured Products Association (SSPA)

This entry is for general information purposes only and does not constitute investment, legal or tax advice. It is a simplified summary of the legal position and tax treatment.