Securitisation and Transfer: Difference between pages

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The process of converting non-tradable assets into tradable securities.
The sending (or movement) of funds or securities or of a right relating to funds or securities from one party to another by:


This is often undertaken through a securitisation special purpose vehicle.
i. The conveyance of physical instruments/money; or


ii. Accounting entries on the books of a financial intermediary; or


The credit risk of the assets is divided into tranches, and payments to the investors are dependent on the performance of the assets.
iii. Accounting entries processed through a funds and/or securities transfer system.


When a special purpose vehicle is used, the assets are transferred to the special purpose vehicle, which then issues securities.
The act of transfer affects the legal rights of the transferor, transferee and possibly third parties in relation to the money balance, security or other financial instrument being transferred.




2.
2.  


The tradable securities created by the securitisation process.
In relation to risk management, a response to risk in which another party is paid - or otherwise induced - to accept the risk.


Such a transfer often leaves counterparty risk on that other party as the primary residual risk.


3.
The 'transfer' risk response includes both insurance and external hedging of financial risks with derivative instruments such as forward contracts.
 
The trend for large companies to use less bank lending facilities and instead to issue their own securities direct to the markets.




== See also ==
== See also ==
* [[CDO]]
* [[Counterparty risk]]
* [[Covered bond]]
* [[Derivative instrument]]
* [[Factoring]]
* [[Final transfer]]
* [[Securitisation special purpose vehicle]]
* [[Fixing]]
* [[Securitisation swap]]
* [[Forward contract]]
* [[Security]]
* [[Hedging]]
* [[Significant Risk Transfer]]
* [[Insurance]]
* [[SSPE]]
* [[Provisional transfer]]
* [[Sukuk]]
* [[Reduce]]
* [[CMBS]]
* [[Repetitive transfers]]
 
* [[Risk response]]
 
* [[Transfer system]]
===Other links===
* [[Payments and payment systems]]
[http://www.treasurers.org/node/9209 The return of securitisation, The Treasurer, July 2013]
 
[[Category:Long_term_funding]]

Revision as of 05:59, 18 June 2016

1.

The sending (or movement) of funds or securities or of a right relating to funds or securities from one party to another by:

i. The conveyance of physical instruments/money; or

ii. Accounting entries on the books of a financial intermediary; or

iii. Accounting entries processed through a funds and/or securities transfer system.

The act of transfer affects the legal rights of the transferor, transferee and possibly third parties in relation to the money balance, security or other financial instrument being transferred.


2.

In relation to risk management, a response to risk in which another party is paid - or otherwise induced - to accept the risk.

Such a transfer often leaves counterparty risk on that other party as the primary residual risk.

The 'transfer' risk response includes both insurance and external hedging of financial risks with derivative instruments such as forward contracts.


See also

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