Customized and client-specific, these transactions also meant something else: fat spreads. By the time the 1990s rolled around, spreads on vanilla derivative transactions collapsed rapidly and new entrants moved in and competition increased. Doing a vanilla fixed-to-floating swap off the back of a bond issuance or floating-to-fixed swap to lock-in the rate on a bank financing simply wasn’t interesting – from a compensation perspective. Knock-ins, knock-outs, up-and-outs, down-and-ins, embedded bermuda swaptions, momentum caps, etc. all helped to differentiate solutions from competitors and preserve proprietary profits in trades. Volumes off the corporate desk simply weren’t great enough to make a business solely on vanilla trades, and smart and creative derivative originators, structures and traders found ways to “add value” through complexity.