European structured finance products continue to absorb elevated credit risks very well from a performance standpoint, according to Unicredit analysts.  

"Structured finance in Europe has passed its first reality stress test, revealing weaknesses with respect to liquidity and transparency but proving overall robust from a fundamental perspective,"  Unicredit analysts said. "Overall defaults of structured finance products are still marginal in Europe. Losses in European exposures were related mainly to mark-to-market losses, a trend that has been reverted now, with increasing stabilization even in asset classes like U.K. nonconforming or CMBS."  

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