Collateral
In doing research on blended finance and especially Debt-for-Nature Swaps, one question has come up repeatedly.
In the event of bankruptcy - who ends up owning the collateral?
And this is a really, really important question, because those blended finance constructs are similar in creation to those CDOs crashing in 2008, taking out all mezzanine investments. Except, of course, this time with public finance (ie, taxpayer funds) on the mezzanine chopping board, should things (as intended) not work out.
I’ve covered Debt-for-Nature Swaps over several posts. Apparently, this particular one takes 28 minutes to read, per my Substack app! Apologies, but I do believe extraordinary claims demand extraordinary levels of evidence.
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