Chapter 3
Structuring and Execution of a Transaction
In this chapter we provide a checklist-style guide on the process, from start to finish, behind structuring a securitization deal. This process is complex and involves a number of parties, both internally (within the originating institution) and also externally (from service and other providers). The originator needs to undertake the steps described next as part of closing the deal, although not all of them will be applicable to the same degree.
Separate from the process described here, but running in parallel, is the legal review and the credit rating agency review, which we describe in the next chapter.
A Securitization Process
The exercise of arranging a securitization transaction is in many ways one of project management. The process itself has some tasks that can run concurrently but also a number that are contingent on other outcomes. As with many projects, the path is not a consistent one; however, we show here a generic template for the order of the process followed in order to establish a transaction ready to bring to market.
Select Arranger
The task line (illustrated graphically in the generic time chart shown at each step we describe) begins with the formal appointment of an arranger. It is probably appropriate to mention there is a great deal of work required to put yourself in a position to win a mandate. Arranger ...
