INVESTMENT BANK AND COMMERCIAL BANK

  719 WORDS  

Many factors directly and indirectly caused the ongoing 2007–2012 global financial crisis which started with the US subprime mortgage crisis. One of the main culprits that is often pointed to as one of the main triggers of the global financial crisis are the mortgage derivative products, where risky mortgages were packaged with more traditionally secure mortgages and sold to corporate investors and other banks as secure investment products. This packaging of mortgages is generally accepted to have masked the real risks that were linked with such a product, which gradually grew as lending criteria were loosened in the first five or six years of the twenty first century.