Structured Finance

Structured finance is a sector of finance created to help provide increased liquidity or funding sources to markets like housing and/or to transfer risk. Liquidity and risk transfer is typically achieved in structured finance through securitization of various financial assets (e.g. mortgages, credit card receivables, auto loans, etc.) which has helped to open up new sources of financing to consumers and businesses. Common example of instruments created through securitization are collateralized debt obligations (CDOs) and asset-backed securities (ABS). The legal structure of these instruments may be quite simple or very complex.

The mortgage market uses structured finance extensively and was traditionally meant to provide liquidity to lenders and funding to borrowers. Controversy has arisen since the 2008 Housing Bubble that structured finance had a role in the bubble and was too complex and not transparent enough to manage or regulate.

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Other articles related to "structured finance, finance, structured":

Structured Finance - Types
... There are several main types of structured finance instruments ... Asset-backed securities (ABS) are bonds or notes based on pools of assets, or collateralized by the cash flows from a specified pool of underlying assets ...
Nationally Recognized Statistical Rating Organization - Subprime Mortgages, CDOs, and The Financial Crisis
... Residential Mortgage Backed Securities, and other creatures of structured finance intimately connected to the subprime industry ... ratings in their decisions to purchase CDOs and other structured finance products ... Janet Tavakoli, author of Structured Finance and Collateralized Debt Obligations, has suggested that these agencies lose their NRSRO status in relation to certain financial products ...
The Journal Of Structured Finance
... The Journal of Structured Finance is a quarterly academic journal on structuring and investing in all types of structured finance, such as asset-backed securities, mortgage-backed securities, collateralized ... The journal was originally established as The Journal of Project Finance, then broadened its focus as The Journal of Structured and Project Finance, before finally ...

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