Although structured finance transactions that involve sovereigns have been around for many years, in 2005 Standard Poor's has seen a flurry of such transactions in Europe and the Middle East. It is probably too early to tell whether this reflects a deep trend or is merely a coincidence.
However, this is an opportune time to look at the roles that sovereign entities play in structured finance transactions. Whichever the role, sovereigns bring with them a specific political risk not present when the sovereign's role is filled by a corporation, and the presence of this risk requires special analytical considerations.
He Who Makes The Law Can Break The...
