Covered Bonds
Our services extend to providing covered bond loan package to our clients. Covered Bonds are similar in many ways to asset-backed securities created in securitization, but covered bond assets remain on the issuer’s consolidated balance sheet.
It is a type of derivative instrument, the bank sells several investments to us, which we then assemble as packages and issue them as bonds.
The interest paid on the bonds is covered by the cash flowing from the loans. We can replace these defaulted or Prepaid loans with performing loans to minimize the risk of the underlying assets.
Covered bonds are standard corporate bonds issued with an extra layer of protection for investors.