In-house 2-day workshop on securitisation

SECURITISATION: THE FINANCIAL INSTRUMENT OF THE NEW MILLENNIUM

Highlights-

  • Securitisation : destined to be the most powerful financial instrument of our times 
  • Wide ranging applications – housing finance, auto finance, equipment leases, hotels, credit card companies, electricity companies, insurance companies, public utilities, educational institutions, and governments. 
  • Upswing of interest in securitisation all over World and emerging markets already visible 
  • Thread bare discussions on all the relevant details 

About the Course

Securitisation is one of the most important developments in the World of finance. It is stated that after the development of the "equity share" as the basis of the present day corporate world, securitisation as the next most important innovation is all set to revolutionise the way entities raise their finances.

Securitisation is no more limited to financial firms – today, a wide range of entities including housing finance companies, banks, auto financiers, leasing companies, hotels, credit card issuers, electricity companies, insurance companies and even governments and local authorities have made innovative use of securitised instruments to convert their future assets into cash in hand. 

While securitisation is one of the most talked-about issues all over the World, it has already made its presence felt in emerging markets as well. A number of interesting deals have been struck in the recent past and very many are in the pipeline. 

In this environment, threadbare training on the concept and nuances of securitisation has become important. The present course will answer the need for education about securitisation by giving to the participants both conceptual as well as working skills about various issues related to securitisation, its applications and benefits. 

Results:

The course is expected to throw light on the concept of securitisation, markets in various countries, technology, manner of structuring securitisation deals, financial evaluation, legal and taxation issues involved, etc. The participants may expect to derive immense benefit out of this platform.

Faculty:

The core faculty is Vinod Kothari. Vinod Kothari has gained international acceptability as a trainer, author and expert on securitisation

For a detailed profile of Vinod Kothari, click here.

Equipment:

The faculty will make use of latest presentation devices to make the presentation effective. No specific equipment is required for the participants.

Fees:

For all in-house courses in India, we would expect a fee of Rs. 30000/- per day for teaching.

For all in-house courses out of India, we would expect a fee of USD 1000 per day for every day spent on the assignment, including travel time.  

Course materials:

Reading materials, and hard copies of the presentation materials will be provided along with the usual conference kit.

Number of Participants:

Upto discretion of the organising entity, but ideal number is 25-40.

Contents:

Securitisation – understanding the concept – meaning of "security" and basic features – development of the concept of securitisation – from common stock to equity share – debentures – securitised mortgage loans – securitised asset portfolios.

Structured finance – its relevance in integrating and differentiating financial assets – economics of securitisation – motivations.

Securitisation markets in the World – securitisation market in developing countries.

Securitisation applications – asset securitisation and future flows securitisation – basic attributes of securitisable assets – commercial mortgage-backed securities – residential mortgage-backed securities – bank loan securitisation – auto loans and equipment leases – credit cards – aviation sector – public utilities stranded costs – insurance risk securitisation – non-financial flows securitisation -hotels, hospitals, industrial companies, intellectual property receivables, etc.

Securitisation methodology – pass through structures, pay through structures, bond structures – relevance of a special purpose vehicle – relevance of rating – process of securitisation.

Legal issues in securitisation – assignment of receivables – legal complications in assignments in Anglo-Saxon systems, Roman-Dutch systems, etc. – Legal structures for securitisation in different markets – legal structures for securitisation in various countries with special reference to the host country- creation of bankruptcy-remote securitisation – enforcement of claims over securitised portfolios – legal rights of the assignor and assignee – legal nature of the asset-backed securities. UNCITRAL initiative on harmonisation of laws on assignment of receivables.

Documentation for securitisation.

Taxation of securitisation transactions – taxation of the originator – sale treatment or loan treatment, application of withholding taxes – taxation of the securitisation SPV – whether taxable entity or tax transparent entity – taxation of the investor – income treatment or capital gain treatment – specific provisions in various countries – taxation of securitisation in various countries with special reference to the host country. Stamp duty issues in securitisation.

Financial evaluation of a securitisation transactions – upfront costs – legal costs, ratings costs, taxes and duties – cost of raising resources – working of ultimate financial economics and comparison with other options.

Accounting for securitisation – off-balance-sheet versus on-balance-sheet treatment -IAS 32, IAS 39, SFAS 125, etc. – Accounting for the SPV – consolidation of the accounts of the SPV with the parent – a new controversy – IAS 27. Accounting norms in some markets – securitisation accounting and capital adequacy considerations for financial intermediaries – BIS statement on securitisation. Accounting for securitisation in the host country- sale treatment or loan treatment? Illustration of various accounting situations.

Rating of securitisation proposals – rating companies' perspectives – rating models of Fitch IBCA, Standard & Poor, etc.

Creating of a framework for securitisation.

Dangers in securitisation overdrive – mortgaging the future for a party today?

 

For more details, contact: vinod@vinodkothari.com