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After completing this reading, you should be able to analyze the key factors that led to and derive the lessons learned from case studies involving the following risk factors:
- Interest rate risk, including the 1980s savings and loan crisis in the US
Funding liquidity risk, including Lehman Brothers, Continental Illinois, and Northern Rock
- Implementing hedging strategies, including the Metallgesellschaft case
Model risk, including the Niederhoffer case, Long Term Capital Management, and the London Whale case
- Rogue trading and misleading reporting, including the Barings case
- Financial engineering and complex derivatives, including Bankers Trust, the Orange County case, and Sachsen Landesbank
- Reputational risk, including the Volkswagen case
- Corporate governance, including the Enron case
- Cyber risk, including the SWIFT case

0:00 Introduction
1:07 Learning Objectives
1:38 Savings and Loans (S&Ls) Associations
12:34 Lehman Brothers
20:27 Northern Rock
21:22 Funding Liquidity Risk: Lessons
23:08 Hedging Strategies
26:30 Metallgesellschaft
30:23 The Niederhoffer Put Options
35:47 The London Whale
43:24 Orange County
44:38 Sachsen Landesbank
46:31 Volkswagen Repuational Risk
48:38 Enron Corporate Governance
51:03 The SWIFT Case Cyber Risk