The end of easy money
Until July 2007, originating and securitising mortgages was an irresistible business for investment banks. The credit crunch has all but shut down the exit — ABS of any kind are hard to place and principal finance deals are particularly out of favour. Chris Dammers considers the recovery options.
Just two years ago, principal finance was the great hope of the European securitisation industry.
Nearly every investment bank in the market which did not already have an in-house source of assets for securitisation decided to get in on the act. They bought up independent finance companies that generated
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