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Leading banks, academics and regulators spent two days stress-testing themselves and the latest in credit risk models. David Shirreff reports.

We are dominated by ideals: perfect tax systems, monetary discipline, level playing fields and - above all - unambiguous lines of ownership. In the real world, though, financial systems and ownership structures are never quite what they seem. The governance of a US joint-stock company is not that far removed from a Chinese village-owned enterprise. And this may not be the best time to impose our ideals on Asia, argues Harrison Young.

In the west, shrinking government, and regions competing for funds under the euro; in the east, a need to upgrade infrastructure and outshine the sovereign credit. The emerging European municipal bond market looks more attractive than bank debt. Marcus Walker reports.

A falling stock market, a dearth of new deals and a faltering privatization programme: on the face of it the Egyptian securities market seems to be in trouble. But look deeper and the picture is not so bleak. Stock prices are holding up better than elsewhere and there is strong government commitment towards broadening and deepening Cairo's capital markets. Philip Moore reports.

Meet some of the world's biggest investors. The 10 largest Japanese life insurance companies control assets of more than $1 trillion. But with a protected market and no shareholders to answer to, they have always done things a little differently to the rest of us. Now as insolvency fears and foreign competition grow, that is starting to change. Jack Lowenstein reports.

Why did Isda beg the CFTC for more time? The International Swaps & Derivatives Association (Isda), with a long history of success in Washington, needed a few more days to frame a response last month to a movement from left field a petition from one of its associate members, the London Clearing House (LCH), to Isda's old arch-enemy, the Commodity Futures Trading Commission (CFTC).

With markets in turmoil and attention switching from returns to credit quality, new ways for assessing counterparties are needed. Our second emerging-market bank (Emba) ratings bring a temperature-taking approach to credit. While rating agencies pore over accounts and spend hours interviewing managers, we use the raw financial ratios that drive much of the ratings process. The results are always provocative. This year Emba highlights island paradises in the Caribbean and the Mediterranean where economies and banks have stayed clear of the fallout from global markets. Those seeking banking peace and pina coladas should read on. Brian Caplen reports.

Early days for corporate bonds

For Latin American corporates the doorway to international bond markets is now locked and bolted for the foreseeable future. But what about the loan market? According to Eugenia Wilds, head of the Latin American loan syndication group at JP Morgan, the key bank lenders will hold fast in a storm.

Sigma triggers global meltdown

Six months into European monetary union there's a crisis, but this has little to do with the euro. It's a classic banking fiasco kicked off because too many people believed in one man's Big Idea. Sound familiar? David Shirreff reports.

Luis Cezar Fernandes had planned to retire in two years' time when he turned 55. The founder of Brazilian investment bank Pactual was looking forward to a more leisurely life on his farm. But that was before two crises erupted - the global meltdown that has challenged all Brazilian bankers and the rift inside Pactual that led to staff breaking away to start their own operation and a change in the firm's ownership.