The purpose of this seminar is to give you a good understanding of how "asset securitization" is used by companies and financial institutions for liquidity creation, risk transfer, regulatory arbitrage, risk management and yield enhancement.

We start with a general introduction to "securitization". We present a generic securitization transaction and discuss the benefits, risks and rewards of this financing technique. We also briefly look at the historic development and recent market trends.

Further, we take a closer look at the various elements in the structuring of a securitization transaction. We explain the role of the "Special Purpose Vehicle" (SPV) and discuss the legal aspects in setting up such an SPV. Further we explain techniques for credit enhancement including subordination, cash collateral, overcollaterization, yield spread accounts, credit substitution, etc. We also explain the pass-through and pay-through techniques for payment management and special features like soft bullets, clean-up calls, and replenishment.

We then present and explain a number of specific structures: Securities backed by home equity loans and "subprime" mortgages, commercial receivables, auto loans, credit card loans. We also present examples of "future flow" and of "intellectual property" securitizations. In each case, we explain the main deal features, and we illustrate with real-life case studies.

Further, we explain the mechanics, pricing and risks of mortgage backed securities and their derivatives (CMO's, REMICs, IO/PO strips and other structures).

Finally, we look at "Collaterized Debt Obligations" - the securitization of bank loans, bonds and other financial assets. We explain how these structures are used to transfer risk, to obtain funding of illiquid asset portfolios, to obtain regulatory relief and to enhance the return on capital of banks with high funding levels. We give practical, real-life examples of these structures, and we explain their pricing and risk characteristics.