Consolidating securities definition
An asset backed security is a security whose value is backed by the cash flows of a pool of receivables, small and illiquid assets or financial assets that cannot be sold individually.These small and illiquid assets, when pooled together into financial instruments, can be purchased by general investors, thus diversifying the risk of investing in such assets as each security will be a part of the total value of the assets.The selling of the pool of the underlying assets to general investors is called Securitization.The securitization of asset backed securities is generally handled by a separate institution known as “Special Purposes Vehicle”, which sells the securities and pay the amount to the bank which created the underlying assets.It also insulates investors from credit risk of loan originator.When Special Purposes Vehicle transfers the credit risk to another institution like an insurance company, the bank which created the underlying assets (known as originating bank) gets cash when the asset-backed securities are sold to the investors, leading to an improvement in credit rating.Where a debtor resides or carries on business in a locality in which there is no licensed trustee, and no licensed trustee can be found who is willing to act as trustee, the court or the official receiver may appoint a responsible person residing in the locality of the debtor to administer the estate of the debtor, and that person, for that purpose, has all the powers of a licensed trustee under this Act, and the provisions of this Act apply to that person as if a licence had been issued to that person under paragraph 5(3)(a).
It is also responsible for distributing the proceeds of the sale of the securities.
If the credit rating is higher, Special Purpose Vehicle and the originating bank can charge more prices for the securities.
A financial statement showing all the assets, liabilities, income and expenses of a parent company and its subsidiaries.
It represents the standing of a company as a group and requires elimination and consolidation of entries to provide a fair presentation of the financial status of the group.
WASHINGTON — The Financial Industry Regulatory Authority (FINRA) announced today that it has sanctioned three firms – H. Consolidated reports supplement, but do not replace official customer account statements required by FINRA rules and disseminated through a separate process.
FINRA Regulatory Notice 10-19 reminds firms that consolidated reports must be clear, accurate and not misleading, and if not rigorously supervised, they can raise a number of regulatory concerns, including the potential for communicating inaccurate, confusing or misleading information to customers, lapses in supervisory controls, and the use of these reports for fraudulent or unethical purposes. Turner did not have any written procedures specifically addressing the use and supervision of consolidated reports. Securities had written procedures related to consolidated reports, it failed to enforce the procedures and did not provide proper training to its representatives regarding their use.