Just as Mr. Schwab has talked about a while ago, in order to help identify risks in bank assets, price and transfer risks through normal transactions, we need to develop a market where risk products can be traded. In a typical market for risk products, the products traded are mainly CDS (Credit default swap) and CDO (collateralized debt obligation).
Through buying and selling risk products, the probability of default is priced and traded. If such risk products are absent or a market where such products can be traded is absent, it would be difficult for the banks to efficiently identify risks and estimate the potential scale and value of loss if defaults materialize.