Covered Bonds vs Securitisation
Covered bonds and securitisations have a lot in common, but they are also very different in some important ways. In this video, Richard discusses the similarities and the differences, between the two products, in terms of their uses, structure and regulation.
Overview
Covered bonds and securitisations have a wide array of similarities. For example, they both utilise residential mortgages as their principle asset for covered bond collateralisation. However, they are also very different in terms of their structure, regulatory treatment and uses.
Key learning objectives:
Identify similarities
Outline the differences in structure, performance, uses, asset eligibility and regulatory treatment
Explain why securitisations require less over-collateralisation
Summary
Expert
Richard Kemmish
Richard is a consultant working mainly in the covered bond market. He helps Finance Ministries and Central Banks in countries without covered bond laws to put legal frameworks in place. He has also helped the European Commission with their legislative agenda for covered bonds and related products.
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