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Asset Backed Securities

Author

Listed:
  • Sabine Langner

    (Albert-Ludwigs-Universität Freiburg)

Abstract

Summary This paper describes the structure and elements of an Asset Backed Securities transaction. Emphasis lies on the credit enhancement, rating analysis and monitoring of the transaction. The potential informational problems of adverse selection and moral hazard are solved by a myriad of mechanisms. The credit enhancement puts the originator at risk and gives him an incentive to service the receivables optimally. The arranger usually guarantees further defaults and thus has an incentive to monitor the originator closely.

Suggested Citation

  • Sabine Langner, 2002. "Asset Backed Securities," Schmalenbach Journal of Business Research, Springer, vol. 54(7), pages 656-673, November.
    • Handle: RePEc:spr:sjobre:v:54:y:2002:i:7:d:10.1007_bf03372691
    DOI: 10.1007/BF03372691
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    References listed on IDEAS

    as
    1. Boot, Arnoud W A & Thakor, Anjan V, 1993. "Security Design," Journal of Finance, American Finance Association, vol. 48(4), pages 1349-1378, September.
    2. Riddiough, Timothy J., 1997. "Optimal Design and Governance of Asset-Backed Securities," Journal of Financial Intermediation, Elsevier, vol. 6(2), pages 121-152, April.
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    More about this item

    Keywords

    D82; G12; G32;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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