Securitisation: Difference between revisions

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1. The trend for large companies to use less bank lending facilities and instead to issue their own securities direct to the markets.
1. ''Assets - tradeable securities''.
 
The process of converting non-tradeable assets into tradeable securities.
 
For example turning non-tradeable assets, like residential mortgage loans, into tradeable assets (such as mortgage-backed securities).
 
 
This is often undertaken through a securitisation special purpose vehicle.
 
 
The credit risk of the assets is divided into tranches, and payments to the investors are dependent on the performance of the assets.
 
When a special purpose vehicle is used, the assets are transferred to the special purpose vehicle, which then issues securities.
 
 
Non-performance of underlying assets is a key risk for investors, and was one of the triggers for the Global Financial Crisis (GFC).
 
 
2.
 
The tradeable securities created by the securitisation process.
 
 
3. ''Securities - issuance.''
 
The trend for larger non-financial companies to use less bank lending facilities and instead to issue their own securities direct to the markets.


2.  The process of converting non-tradable assets into tradable securities.


== See also ==
== See also ==
* [[CDO]]
* [[CMBS]]
* [[Collateral]]
* [[Collateralise]]
* [[Covered bond]]
* [[Factoring]]
* [[Factoring]]
*[[Global Financial Crisis]]  (GFC)
* [[Loan]]
* [[Mortgage]]
* [[Mortgage-backed securities]]  (MBS)
* [[Prospectus Regulation]]
* [[Receivables securitisation]]
* [[Securitisation Regulation]]
* [[Securitisation special purpose vehicle]]
* [[Securitisation swap]]
* [[Securitise]]
* [[Security]]
* [[Security]]
* [[Significant Risk Transfer]]
* [[Sponsor]]
* [[SSPE]]
* [[Sukuk]]
* [[Sukuk]]
* [[Whole business securitisation]]


[[Category:Long_term_funding]]

Latest revision as of 19:28, 20 January 2024

1. Assets - tradeable securities.

The process of converting non-tradeable assets into tradeable securities.

For example turning non-tradeable assets, like residential mortgage loans, into tradeable assets (such as mortgage-backed securities).


This is often undertaken through a securitisation special purpose vehicle.


The credit risk of the assets is divided into tranches, and payments to the investors are dependent on the performance of the assets.

When a special purpose vehicle is used, the assets are transferred to the special purpose vehicle, which then issues securities.


Non-performance of underlying assets is a key risk for investors, and was one of the triggers for the Global Financial Crisis (GFC).


2.

The tradeable securities created by the securitisation process.


3. Securities - issuance.

The trend for larger non-financial companies to use less bank lending facilities and instead to issue their own securities direct to the markets.


See also