Operational Risk Came into Prominence During the Global Financial Crisis

Operational risk came into prominence during the global financial crisis (GFC) due to:

A) Lehman Brothers using 'recycled collateral' to expand their funding beyond on-balance-sheet assets
B) the classification of 'sophisticated investors' led to investment banks not providing material information about the riskiness of derivative transactions
C) the credit default swap market was likely to cause systemic market risk due to difficulties in settling out trades with distressed or failed counterparties
D) All of the listed options are correct.

Correct Answer:

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