Context:
Securitisation volumes are expected to have surpassed ₹ 68,000 crore in Q3FY25: ICRA
Securitization Volumes
Securitization volumes in banking is the amount of assets that have been pooled and repackaged into interest-bearing securities:
- Definition
- Securitization is the process whereby banks pool assets, such as loans, and repackage them into securities, known as asset-backed securities (ABS). The interest and principal payments from the assets are then passed on to the security buyers.
- Purpose
- Banks use securitization to:
- Refinance loans with capital market investors
- Transfer credit risk to investors
- Free up capital for new loans or distributions to investors
- Turn illiquid loans into more liquid securities
- Banks use securitization to:
ICRA Limited (ICRA)
ICRA Limited (ICRA) is an independent and professional investment and credit rating agency in India.[2] The company has been in existence since 1991 under the name Investment Information and Credit Rating Agency of India Limited (IICRA India).
