Securitisation
/ˌsɪˌkjʊərətaɪˈzeɪʃən/
Definitions
- (n.) The process of pooling various types of contractual debt and selling consolidated debt as bonds or securities to investors.
The bank undertook securitisation to convert its mortgage loans into tradable securities.
- (n.) A financial technique used to enhance liquidity and transfer risk by repackaging assets into marketable instruments.
Securitisation allows firms to manage risk by transforming illiquid assets into securities.
Related terms
See also
Commentary
In drafting, clarify the type of assets securitised and regulatory compliance to specify legal scope and risk allocation.
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.