An Introduction to Asset-backed
By Firminy Capital Sarl
• Throughout its history in Luxembourg, Firminy Capital
Sarl has established itself as a securitization firm serving
clients in Europe and beyond. Securitization firms like
Firminy Capital Sarl often manage products such as
asset-backed securities, which are widely traded in
financial markets throughout the world.
As the name suggests, an asset-backed security is a
financial security backed by assets other than real estate
or mortgage products. Commonly backed by assets such
as leases, receivables, loans, and credit card debt, an
asset-backed security represents an alternative for
individuals looking to invest in corporate debt.
• Originators of asset-backed securities reduce
their risk-weighted assets, which frees up
additional capital to originate more loans. If a
pool of assets performs extremely poorly,
originators typically do not have to pay the cost
of bankruptcy. As such, the asset-backed
security represents a possible solution for banks
and other originators looking to eliminate risk
assets from their balance sheets.