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A financial asset securitization investment trust (FASIT), a defunct entity used for securitization of any debt for asset-backed securities. An Irish Section 110 Special Purpose Vehicle (SPV) (S110 SPV), the largest SPV in the EU for securitisation.
Orphan structure or Orphan SPV or orphaning are terms used in structured finance closely associated with creating SPVs ("Special Purpose Vehicles") for securitisation transactions where the notional equity of the SPV is deliberately handed over to an unconnected 3rd party who themselves have no control over the SPV; thus the SPV becomes an "orphan" whose equity is controlled by no one.
Advantages of securitization – Depository banks had incentive to "securitize" loans they originated—often in the form of CDO securities—because this removes the loans from their books. The transfer of these loans (along with related risk) to security-buying investors in return for cash frees up the banks' capital.
The SPV (securitization, credit derivatives, commodity derivative, commercial paper based temporary capital and funding sought for the running, merger activities of the company, external funding in the form of venture capitalists, angel investors etc. being a few of them) is "designed to insulate investors from the credit risk (availability as ...
Securitization is the financial practice of pooling various types of contractual debt such as residential mortgages, commercial mortgages, auto loans, or credit card debt obligations (or other non-debt assets which generate receivables) and selling their related cash flows to third party investors as securities, which may be described as bonds, pass-through securities, or collateralized debt ...
The total-debt-to-total-assets ratio is one of many financial metrics used to measure a company’s performance. In this case, the ratio shows how much of a company’s operations are funded by debt.
An Irish Section 110 special purpose vehicle (SPV) or section 110 company is an Irish tax resident company, which qualifies under Section 110 of the Irish Taxes Consolidation Act 1997 (TCA) for a special tax regime that enables the SPV to attain "tax neutrality": i.e. the SPV pays no Irish taxes, VAT, or duties.
A bank transfers risk in its loan portfolio by entering into a default swap with a ring-fenced special purpose vehicle (SPV). The SPV buys gilts (UK government bonds). The SPV sells 4 tranches of credit linked notes with a waterfall structure whereby: Tranche D absorbs the first 25% of losses on the portfolio, and is the most risky.