Securitisation Overview

Since the entry into force of the Luxembourg Securitisation Law of 22 March 2004 („Securitisation Law“), the Luxembourg securitisation market has developed significantly. The Luxembourg legislator has managed to create an effective framework that offers institutional investors a lot of flexibility and extensive procedures for insolvency protection.

Specifically, this means that in addition to the eligibility of all asset classes and securitisation instruments, institutional investors are now offered the opportunity to create a ring-fenced compartment within a securitisation platform. This means that the assets contributed are independent of the platform itself and of other compartments in this platform, and are thus protected. In addition, the respective compartments are periodically audited by a mandated recognised auditing firm and thus have corresponding organisational obligations.

Luxembourg has thus ensured transparent and effective legal certainty for institutional investors as well as reliability within the securitisation market, and has thus finally established itself as the most attractive securitisation market in Europe, if not in the world.

 

SECURITISABLE ASSETS

The Luxembourg Securitisation Law does not impose any restrictions on the basis of assets that can be securitised.

Our platforms structure and implement securitisations by setting up Compartments. We aim to accompany our initiators and the institutional investors individually and holistically throughout the entire securitisation process.

The possibilities of securitisation are broad. Basically, any tangible and intangible asset can be securitised with sufficiently determinable values or future cash flows, such as: 

        • Commodities
        • Equity investments
        • Loans
        • Receivables of all kinds
        • Mortgages
        • Insurance Policies
        • Bond Investments
        • Mezzanine Capital
        • Rights and Claims
        • etc.

We help to find the right solution for you. In addition, our service offering includes the ongoing administration and support by an experienced administration and calculation agent and its employees as well as the creation of tailormade reportings.

Structured processes and individualisation enable us to successfully meet your securitisation requirements.

INVESTOR PROTECTION

There is a high level of investor protection and Issuer default protection. The use of depository bank and trustee are possible. The investors‘ rights and obligations are limited to their specific Compartment (ringfenced). In addition, a separate liquidation of a Compartment is possible.

FISCAL TREATMENT

There is almost complete tax neutrality, i.e. a Compartment is treated beneficial from a tax point of view. All payments made by the Compartment in relation to issued securities (be they bonds or shares) are fully tax-deductible expenses for the Compartment. Furthermore, securitisation vehicles and it’s Compartments benefit in principle from a large number of Luxembourg double taxation treaties.