Securitization: The Indian Experience

Oorja-IIIM Journal of Management & IT, Vol. 02, No. 01, May 2004

9 Pages Posted: 14 Nov 2006 Last revised: 1 Sep 2012

See all articles by Lokanandha Reddy Irala

Lokanandha Reddy Irala

School of Management Studies, University of Hyderabad

Krishna Chaitanya Vadlamannati

affiliation not provided to SSRN

Date Written: August 30, 2012

Abstract

A wide variety of financial markets have been characterized by the growth in securitization during the past twenty years as numerous advantages accrue from holding financial assets in securitized rather than whole loan form.

Over the last decade securitization has migrated from the United Sates into Europe and the rest of the world and taken a permanent hold on the fixed income market.

Securitisation refers to conversion of cash flows into marketable securities. It is a process through which illiquid assets are packaged, converted into tradable securities and sold to third party investors.

Securitisation has arrived in a developing country like India much faster than expected. Securitization may help Indian Banks reduce their regulatory, and sometimes economic and capital requirements.

While Securitization serves as a powerful tool of financial reengineering, striking a securitization deal is not that simple. It involves substantial costs, complexity and a longer time period to complete it.

Keywords: Securitization, India, SPV, Risk

JEL Classification: G12, G21

Suggested Citation

Irala, Lokanandha Reddy and Vadlamannati, Krishna Chaitanya, Securitization: The Indian Experience (August 30, 2012). Oorja-IIIM Journal of Management & IT, Vol. 02, No. 01, May 2004, Available at SSRN: https://ssrn.com/abstract=944409

Lokanandha Reddy Irala (Contact Author)

School of Management Studies, University of Hyderabad ( email )

Prof. CR Rao Marg
Gachibowli
Hyderabad, Telangana 500046
India
8247705022 (Phone)

HOME PAGE: http://www.irala.org

Krishna Chaitanya Vadlamannati

affiliation not provided to SSRN

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