ABS

ABS or asset-backed securities are bonds or notes created via securitisation that are backed by a range of assets or receivables. Generically, all securitisations can be labelled ABS and it is often used as a coverall term; in some cases in SCI, ABS will be used in this manner. However, in many cases, ABS are taken to exclude mortgage-backed securities (MBS) and structured credit instruments, such as CDOs. If so, then asset-backed securities or ABS are taken to include consumer ABS, such as credit card securitisations, auto loan or dealer floorplan ABS, student loan securitisations, project finance/infrastructure securitisations and equipment leasing-based transactions. ABS originators are typically loan issuers, such as banks, credit card companies, auto finance and consumer finance firms, but can be any institution that generates regular, quantifiable future income flows (or cashflows), which includes governments. To create asset-backed securities, institutions sell pools of their loans to a special-purpose vehicle, or SPV, which then sells the loans to a trust. The trust then repackages the loans as interest-bearing securities and issues them. This true sale of the loans to the SPV ensures that the ABS is treated as being bankruptcy-remote from the originator.


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    Market moves    25 February 2021
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  • Democratising access

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    News Analysis    25 February 2021
  • Strong pipeline

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    News    23 February 2021
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    News Analysis    23 February 2021
  • Irish NPE portfolio offloaded

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    Irish NPE portfolio offloaded AIB Group is set to sell a non-performing loan portfolio in long-term...

    Market moves    22 February 2021
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    News    22 February 2021
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    News    22 February 2021
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    Market moves    19 February 2021
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    News Analysis    19 February 2021
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  • Forgive and forget

    Student loan forgiveness heralds widespread prepayment in student loan ABS, but is credit positive

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    News Analysis    18 February 2021
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    Market moves    15 February 2021
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    News    15 February 2021
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