The "CDO problem" of 2001 - considered to be a largely U.S. phenomenon for most of the year - is expected to become firmly entrenched on European shores in early 2002.

While a record number of downgrades had marked the year as particularly turbulent for CDOs in the U.S., the European market had largely been spared; in fact, the number of upgrades had actually outnumbered downgrades during the second quarter and even the third quarter in European activity. But that trend is about to change, analysts say.

Subscribe Now

Access to a full range of industry content, analysis and expert commentary.

30-Day Free Trial

No credit card required. Access coverage of the securitization marketplace, including breaking news updated throughout the day.