Securitization is a structure finance process to raise fund from the capital
market. This is a very efficient way to raise fund from the market as 1) it
does not have recourse on the originator. 2) you are securitizing the assets
which are already on your balance sheet so you do not carry the repayment risk
with you which is very which in case of term loans and other debt
instruments.
The securitization process is like: Originator converts the
underlying receivables in securities (bonds) and sell it to the investor in
the securities market and raise capital. Since the day of selling those bonds,
the originator starts paying off the investor until the investor is repaid all
money (interest+principal).
If you want more information visit our website
www.spananalytics.com or you can call me at 09920725885.
|
|