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Einstandsrisiko

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21:19 May 1, 2008
German to English translations [PRO]
Bus/Financial - Finance (general)
German term or phrase: Einstandsrisiko
Bank A has issued a letter of comfort for Bank B (its subsidiary). This says that Bank A will assume the liabilities of Bank B under certain circumstances. In its annual report, Bank A states that it is only required by law to report the existence of the letter of comfort, but instead it is providing additional information about transactions that could cause Bank B to be subject to an "Einstandsrisiko."

I understand this to be the risk that Bank B will get into a situation that will result in Bank A having to stand good for Bank B's liabilities - is that right? What is a concise term for this type of risk?
Daina Jauntirans
Local time: 15:54
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Summary of answers provided
4{cross-}indemnity riskxxxAdrian MM.
3liability risk
swisstell


Discussion entries: 2





  

Answers


1 hr   confidence: Answerer confidence 3/5Answerer confidence 3/5
liability risk


Explanation:
if, as it seems, this is an Austrian text.

swisstell
Italy
Local time: 22:54
Meets criteria
Specializes in field
Native speaker of: German
PRO pts in category: 175
Notes to answerer
Asker: That seems reasonable, although it's not an Austrian text.


Peer comments on this answer (and responses from the answerer)
neutral  xxxwfarkas: 'Einstandsrisiko' is used also in Germany
1 day15 hrs
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2 days19 mins   confidence: Answerer confidence 4/5Answerer confidence 4/5
{cross-}indemnity risk


Explanation:
Einstand is a difficult one, esp. in combinations like Einstandspflicht.

I don't see a problem with one bank cross-indemnifying - NB not cross-guaranteeing - another. There is a difference and it is misleading to mix up the two terms.

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Note added at 2 days49 mins (2008-05-03 22:09:27 GMT)
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Then try 'reverse indemnity risk'

Example sentence(s):
  • For all of us, the keys to managing indemnity risk are:. Understanding the concept of indemnity;; Understanding basic legal principles that apply to ...

    Reference: http://www.gibbesburton.com/indemnity.htm
xxxAdrian MM.
Local time: 22:54
Meets criteria
Specializes in field
Native speaker of: Native in EnglishEnglish
PRO pts in category: 95
Notes to answerer
Asker: I will read your link - it looks useful! I don't think it's applicable here, though. Bank B very clearly caused Bank A the liability. I can't give too much context, but it's clear from my text.

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