AB
1101 defines terms used in Regulation AB
Asset-backed
security -
AB 1101(c)
-
"Primarily serviced by the cash flows of a discrete pool of receivables or
other financial assets"
- A key definition, as it defines the scope of Regulation AB
- Definition permits up to 50% prefunding
- For automobile leases, up to 65% of a
deal can be backed by vehicle residual values
- Does not include synthetic ABS
which rely primarily on derivative contracts (such as total return swaps)
rather than raw financial assets
Third
party information
- e.g.,
credit enhancement providers and significant obligors
