Asset Partition
/ˈæsɛt ˌpɑːrtɪʃən/
Definitions
- (n.) A legal and financial structuring method that segregates assets into separate groups or compartments to isolate liabilities and risks.
The company implemented asset partition to protect its core assets from the creditors of its subsidiaries.
- (n.) A doctrine in securitization law that treats certain assets as separate from the originator's estate to protect investors in the event of insolvency.
Asset partition ensures that investors retain rights to the collateral even if the originator goes bankrupt.
Forms
- asset partition
- asset partitions
Related terms
See also
Commentary
Asset partition is often employed in structured finance and insolvency contexts; drafting clarity on the boundaries and rights associated is critical to avoid disputes.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.