• We are pleased to announce that the winner of our Feedback Prize Draw for the Winter 2024-25 session and winning £150 of gift vouchers is Zhao Liang Tay. Congratulations to Zhao Liang. If you fancy winning £150 worth of gift vouchers (from a major UK store) for the Summer 2025 exam sitting for just a few minutes of your time throughout the session, please see our website at https://www.acted.co.uk/further-info.html?pat=feedback#feedback-prize for more information on how you can make sure your name is included in the draw at the end of the session.
  • Please be advised that the SP1, SP5 and SP7 X1 deadline is the 14th July and not the 17th June as first stated. Please accept out apologies for any confusion caused.

Structured Finance vs Credit Secruitisation

C

Clint Tan

Member
I am confused by Structured Finance (Credit Enhancement & Credit Insurance Wrap) and Credit Securitisation.

How are they different?
 
A credit enhancement is any strategy that improves a company's credit rating, eg by providing collateral on a debt, or by obtaining insurance to guarantee repayment of the debt, or by arranging a third party guarantee, etc.

Credit wrapping is a type of credit enhancement whereby a bond insurer guarantees to meet interest and principal payments if the issuer cannot.

Credit securitisation is the process whereby loans are packaged, underwritten and sold in the form of securities. More often it's just called "securitisation".
 
You must log in or register to reply here.
Back
Top