WS REF CONTING CLAIM ANAL (4V): (In 4 Volumes)Volume 1: Foundations of CCA and Equity ValuationVolume 2: Corporate Debt Valuation with CCAVolume 3: Empirical Testing and Applications of CCAVolume 4: Contingent Claims Approach for Banks and Sovereign Debt

Black and Scholes (1973) and Merton (1973, 1974) (hereafter referred to as BSM) introduced the contingent claim approach (CCA) to the valuation of corporate debt and equity. The BSM modeling framework is also named the 'structural' approach to risky debt valuation. The CCA considers all stakeholders of the corporation as holding contingent claims on the assets of the corporation. Each claim holder has different priorities, maturities and conditions for payouts. It is based on the principle ...