Industrial Bank of Taiwan teams up with SG to push ABS

Taiwan has yet to use securitization. An agreement between the Industrial Bank of Taiwan and SG seeks to change that.

The Industrial Bank of Taiwan IBT, formed in 1999 to support strategic business sectors and accelerate corporate restructuring through the provision of medium and long-term financing, has signed an agreement with SG Asia to get the asset-backed securitization ABS market moving in the Island Republic.

The two parties are also in discussions about a possible collateralized loan obligation CLO deal, using receivables from IBT's loan portfolio. In a CLO deal, the cash flows that go to the special purpose vehicle SPV are divided into different tranches, with each one having different payback periods and levels of seniority according to investor demand.

An IBT official explains, We've just signed a cooperation agreement...

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