„Sovereign Risk“

1. The risk to a lender that the government of a sovereign state may default on its financial obligations.

2. Also, the risk to a lender that unfavorable changes in the borrowers overall currency exchange position might imperil the payment of a loan.

3. Also the risk to a lender that unfavorable political events in the country of the debtor might imperil repayment.

Eichengreen, Barry J., and Hausmann, Ricardo. “Exchange Rates and Financial Fragility”. In New Challenges for Monetary Policy. Kansas City: Federal Reserve Bank of Kansas City, 1999. Pp. 329-364.