It is a financial practice that consists of grouping various types of assets (notably credit securities such as unpaid invoices issued, tax debts, among others), converting them into negotiable standardized securities in the domestic and foreign capital markets.
Thus, a debt is transferred, sold, in the form of bonds, to several investors. Securitization is a conversion of debt (trade notes, checks, promissory notes) into a security that is negotiable between financial institutions. These securities may be purchased directly by banks, securities dealers or mutual funds as a means of monetizing or investing capital. It will also be up to the buyer of the securitized security and the individual collection of all debts that make up the security, exempting the Securitizer and any intermediary from any burden.
These securities are therefore characterized by a future payment commitment of principal and interest from a proven cash flow from the portfolio of selected assets.
Securitization is used by the financial system for fund detection and risk sharing. It is a way of transforming relatively non-securities assets by shifting the risks associated with them to the investors who buy them.
We work with companies in various industries, securing securitizations so borrowers can receive long-term funds to:
(i) Make new investments
(ii) Paying construction costs
(iii) Amortize short-term debt
(iv) Increase liquidity level
(v) Diversify as sources of funds