Govt. Program Not Enough to Offset TruPS CDO Losses

November 24, 2008

Weak economic conditions have put capital strains on trust preferred securities (TruPS) issuers, causing a rise in payment deferrals and defaults within pools of these assets, TruPS CDOs. Despite the government's promise of liquidity via the Troubled Asset Relief Program (TARP), market participants are not convinced that helping the banks will be enough to offset losses in these pools.

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