RBI fixes minimum ticket size for issuance of securitisation notes at Rs.1 crore

RBI fixes minimum ticket size for issuance of securitisation notes at Rs.1 crore

Reserve Bank of India (Securitisation of Standard Assets) Directions, 2021, exposures to securitisations that are STC (simple, transparent, and comparable)-compliant can be subject to the alternative capital treatment. As per the guidelines of RBI, the minimum ticket size for the issuance of securitization notes will be Rs.1 crore.

What is Securitisation?

 Securitisation involves transactions where credit risk in assets is redistributed by repackaging them into tradeable securities with different risk profiles which may give investors of various classes access to exposures which they otherwise might be unable to access directly.

What are securitization notes – it means securities issued by the special purpose entity as a part of a securitization.

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