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.


  • ESG scores launched

    New scoring system has "limited" credit rating impact

    Fitch has introduced new ESG Relevance scores for structured finance and covered bonds, which commun...

    News Analysis    18 October 2019
  • Best in class

    SCI Capital Relief Trades Awards winners revealed

    The winners of SCI’s inaugural Capital Relief Trades Awards were revealed at a ceremony la...

    News    18 October 2019
  • Inaugural French ABS prepped

    ABS is first SME deal from promotional bank

    Bpifrance is marketing a debut €2bn SME ABS. The transaction, dubbed Bpifrance 201...

    News    18 October 2019
  • Positive impact

    Capital allocation factor debuts

    Societe Generale has completed an innovative risk transfer transaction that, for the first time, inc...

    News    16 October 2019
  • Euro advisory firm boosts SF expertise

    Company hires and sector developments

    Euro advisory firm boosts SF expertise Zedra has hired Rens van Hoof as head of capital market sol...

    Market moves    16 October 2019
  • Indian ABS soars

    Sector developments and company hires

    CLO business announced AllianceBernstein has announced a new loan and CLO management business, hir...

    Market moves    15 October 2019
  • Serbian NPL disposal plans announced

    Sector developments and company hires

    Associate appointed Channel Capital Advisors has hired Pouya Jafari as an associate in London. He...

    Market moves    14 October 2019
  • Auto SRT finalised

    Excess spread follows new regulatory guidance

    Santander has completed its eighth transaction from the Kimi programme. The €799m true sale...

    News    14 October 2019
  • SCI Start the Week - 14 October

    A review of securitisation activity over the past seven days

    SCI CRT Seminar The line-up for SCI's 5th Annual Capital Relief Trades Seminar on 17 October has be...

    News    14 October 2019
  • Meaningful constituent?

    Perceived difference between IRB, standardised banks narrowing

    Recent transactions imply that the difference between how IRB and standardised banks are perceived b...

    News Analysis    14 October 2019
  • Hercules sets forth

    Greek asset protection scheme approved

    The European Commission has announced that the Greek government’s asset protection scheme...

    News Analysis    11 October 2019
  • Framework focus

    EBA synthetics paper welcomed, despite concerns

    Risk transfer market participants have welcomed the EBA’s discussion paper on STS syntheti...

    News Analysis    11 October 2019
  • Structured finance head appointed

    Sector developments and company hires

    EBA’s agenda released The EBA has published its 2020 agenda, detailing its work activiti...

    Market moves    11 October 2019
  • CRT line-up finalised

    Awards ceremony to round off risk transfer event

    The line-up for SCI’s 5th Annual Capital Relief Trades Seminar on 17 October has been fina...

    News    11 October 2019
  • Risk transfer round-up - 10 October

    Capital relief trade sector developments and deal news

    RBS is rumoured to be readying a capital relief trade backed by project finance loans. According to...

    News    10 October 2019
  • Co-founder to depart

    Company hires and sector developments

    Co-founder moves on BlueMountain’s co-founder and co-president Stephen Siderow is set to...

    Market moves    10 October 2019
  • Credit system "positive" for China SF deals

    Sector developments and company hires

    Credit system a positive for China SF deals China’s plan to establish a comprehensive, n...

    Market moves    9 October 2019
  • Opening up

    Platform hopes to securitise global banks' trade finance assets

    While trade finance assets are of growing interest to investors, due to the attractive risk-return p...

    News Analysis    9 October 2019
  • Bank leaves CDS committee

    Sector developments and company hires

    Bank leaves CDS committee Societe Generale has decided to leave the Credit Determinations Committe...

    Market moves    7 October 2019
  • SCI Start the Week – 7 October

    A review of securitisation activity over the past seven days

    Transaction of the week RMF is marketing its first private RMBS backed by jumbo proprietary reverse...

    News    7 October 2019
  • Rating challenges

    Limited appetite for rated senior mezz

    Issuers have typically refrained from seeking ratings on the senior mezzanine tranches of dual-tranc...

    News Analysis    7 October 2019