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Definition

Securitization

Securitization is the process of transformation of a bank loan into tradable securities. It often involves the creation of a separate corporate entity, the Special Purpose Vehicle (SPV), which buys the loans financing itself with securities that are sold to investors.


Securitization is a process in which financial relationships (such as loans) are converted into financial securities or assets (such as bonds) which can be bought and re-sold in securities markets.

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