ASSET SECURITIZATION

PRESENTED BY
KHUSHPREET KAUR

ROLLNO:27642034772
 WHAT IS SECURITIZATION ?

Securitization is the process of conversion of receivables and

cash flow generated from a collection or pool of financial assets like
mortgages loans, auto loans , credit card receivables etc. into the
marketable securities.

 Securitization is the process of conversion of existing assets or

future cash flow into marketable securities and thereby getting
finance.

 securitization is thus a structured finance technique that allows

credit to be provided directly through market process rather than
through financial intermediaries.
TYPES OF
SECURITIZATION
Assets backed securities

Mortgage backed securities

Collateralized debt obligation

ASSETS BACKED
SECURITIES

An asset backed securities is

the type of financial investment
that is collateralized by an
underlying pool of asset-
usually ones that generate a
cash flow debt, such as loan
credit card balances or
receivables.
 MORTGAGE BACKED
SECURITIES
Mortgage backed securities are bonds that are backed by
pools of mortgage loans . Example mortgage papers , house
papers , land and property papers.

Collateralized debt
obligation
it is an investment grade security backed pool of various
other securities.
ADVANTAGES OF
SECURITIZATION
TO ISSUER TO INVESTOR

Reduce funding cost Quality investment

Transfer of risk Less credit risk
Lower capital recruitment
Better returns
Reduce assets liability
mismatch Diversified portfolio
Earrings Benefit small investors
Liquidity