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Better Braking for ABS: Reform Proposals for the Asset-Backed Securities Market

Author

Listed:
  • David C. Allan

    (Tao Group of Companies)

  • Philippe Bergevin

    (C.D. Howe Institute)

Abstract

The market for asset-backed securities (ABS) – financial instruments backed by underlying assets such as mortgages – suffered a major setback in 2007, as a cascade of downgrades and defaults brought turmoil to credit markets and the world economy. Authorities in the United States have since proposed sweeping changes to the ABS market. The Canadian Securities Administrators, representing provincial securities commissions, recently released a discussion paper proposing similar reforms, which would require: (i) sharply enhanced transparency in ABS structures, (ii) CEO certification of the adequacy of such structures, and (iii) disclosure of previous asset repurchases by the securities’ sponsor.

Suggested Citation

  • David C. Allan & Philippe Bergevin, 2011. "Better Braking for ABS: Reform Proposals for the Asset-Backed Securities Market," e-briefs 123, C.D. Howe Institute.
    • Handle: RePEc:cdh:ebrief:123
    as

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    File URL: https://www.cdhowe.org/public-policy-research/better-braking-abs-reform-proposals-asset-backed-securities-market
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    References listed on IDEAS

    as
    1. David C. Allan & Philippe Bergevin, 2010. "The Canadian ABS Market: Where Do We Go From Here?," C.D. Howe Institute Commentary, C.D. Howe Institute, issue 315, November.
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    More about this item

    Keywords

    Financial Services; asset-backed securities (ABS); credit markets;
    All these keywords.

    JEL classification:

    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation

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