Explain potential benefits for the investors buying the abs

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Question: You are a finance employee at a financial institution, specializing in originating auto loans in a country where auto loans have only been available for 2 years. Your group has just been informed that a close competitor has securitized $150 million in auto loans through an investment bank.

1. Your boss wants to understand why the competitor did this. Explain.

2. He also wants to understand the potential benefits for the following:

• the issuer

• the investors buying the ABS

• the individual borrowers seeking auto loans

3. He also wants to know the likely impact to the auto loan market in this country if a large, liquid ABS market emerges over the next few years.

Reference no: EM132274630

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