Securitization

Securitization means acquisition of financial assets by any securitization company or reconstruction company from any originator, whether by raising of funds by such securitization company or reconstruction company from qualified institutional buyers by issue of security receipts representing undivided interest in such financial assets or otherwise.

Securitization helps banks/FIs/NBFCs to sell off their bad loans (NPAs or non performing assets) to asset reconstruction companies (ARCs). ARCs act as debt aggregators and are engaged in acquiring bad loans from the banks/FIs/NBFCs thereby helping banks/FIs/NBFCs to focus on core activities.We buy the NPA and securities it by way of Merger or Asset Stripping.