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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    CRT sector developments and deal news

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    EMEA Alvarez & Marsal has launched a European debt advisory practice with the appointment...

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    News    21 January 2020
  • SCI Start the Week - 20 January

    A review of securitisation activity over the past seven days

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    News    20 January 2020
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    Call for FFELP solution The SFA has joined the Education Finance Council (EFC) in calling for whole...

    Market moves    16 January 2020
  • Consumer boost

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    News    16 January 2020
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    Market moves    15 January 2020
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    Market moves    14 January 2020
  • Under pressure

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    News Analysis    14 January 2020
  • SCI Start the Week - 13 January

    A review of securitisation activity over the past seven days

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    News    13 January 2020
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  • Leasing guarantee

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    News    24 December 2019
  • SCI Start the Week - 23 December

    A review of securitisation activity over the past seven days

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    News    23 December 2019
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