Deutsche strip bond starts Taiwan fund cleanup

The regulators indicate asset securitization is also in the works.

Deutsche Bank has completed Taiwan's first strip bond transaction in a move designed to avoid a potential crisis in the country's bond fund industry. Yesterday February 3 the investment bank stripped NT$2.6 billion $82 million worth of principal obligations PO in structured bond funds away from the interest obligations IO, allowing it to sell back the PO in the form of zero-coupon bonds to the counterparty, a domestic securities investment trust company.

Although Deutsche...

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