Term of the Day -Structured Finance

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Rahul Gupta

Project Controller ACA MBA(Fin.)

8019 Points Joined July 2007

What Does Structured Finance Mean?

A service that generally involves highly complex financial transactions offered by many large financial institutions for companies with very unique financing needs. These financing needs usually don't match conventionalfinancial products such as a loan

Structured finance has become a major segment in the financial industry since the mid-1980s. Collateralized bond obligations (CBOs), collateralized debt obligations (CDOs), syndicated loans and synthetic financial instruments are examples of structured financial instruments.

Hv a nice day..

Replies (2)

Vinod Kothari

Chief

1269 Points Joined March 2010

Where a financial instrument is structured to suit investor needs - for example, rating, interest rate risk, repayment period, we can call is structured product or structured finance. The term is most commonly associated with securitisation but it is wider than the latter term.

All asset backed securities are examples of structured finance products - of course, CDOs are structured products. You may read tons of information about structured finance on my site www.vinodkothari.com