De Rato warns against private equity buy-outs

Rodrigo de Rato, the managing director of the International Monetary Fund, has warned against the dangers posed to global investment and growth prospects from the sharp rise in private equity buy-outs.

Speaking in Manilla on 31 July, de Rato said the troubles in the American sub-prime housing market provided an example of these risks. He called for a fresh look at leaders' underwriting standards and more education of borrowers.

De Rato added that private equity buy-out deals could trigger risk

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