Securitisation is a process whereby loans, receivables and other financial assets are pooled together, with their cash flows or economic values redirected to support payments on related asset-backed securities
The assets most commonly involved include residential and commercial mortgage loans, as well as a wide variety of non mortgage assets such as trade receivables, credit card balances, consumer loans, lease receivables, automobile loans, and other consumer and business receivables.
However, the basic concept of securitisation can be applied to any asset that has a reasonably ascertainable value, or that generates a reasonably predictable future stream of revenue. Consequently, securitisation has been extended to a diverse array of less well known assets, including insurance receivables, obligations of shippers to railways, commercial bank loans, health care receivables, obligations of purchasers to natural gas producers, and future rights to entertainment royalty payments, among many others.
EcoSecuritisation is a conceptual framework developed by EnviroMarket Ltd which enables policymakers to explore and test the implication of different government policies (e.g. procurement strategy, environmental market regulations etc) on subsequent access to finance from institutional investors through conventional securitisation techniques.