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Companies Securitize Everything as Investors Reach for Yield
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Companies Securitize Everything as Investors Reach for Yield

Claire Boston
Bloomberg, 2019
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Editorial Rating

8

Qualities

  • Analytical
  • Eye Opening
  • Overview

Recommendation

You can find fast food almost anywhere, and, if you have a craving for it, you can now even buy it in the bond markets. In this eye-opening article, financial journalist Claire Boston reports on one of the hottest trends in the asset-backed securities market: “whole-business securitizations.” Boston explains the underlying concept, explores the current state of the market and examines why it has whetted investor appetite. Asset managers, financial analysts and corporate investors will want to take a big bite of this information.

Summary

“Whole-business securitizations” flourish as issuers’ borrowing costs decrease.

Lately, several companies have bundled their businesses into securities and sold the rights to their assets. The resulting bonds are known as whole-business securitizations, and they form a part of the asset-backed securities market. According to Bloomberg, the annual deal volume in this sector has already reached $6.9 billion as of August 2019. This trend is likely to keep rising as new industries enter the market. A variety of businesses – including fast-food chains, music rights companies...

About the Author

Claire Boston is a credit reporter for Bloomberg.

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