Site navigation

Banker sale of a mortgage portfolio by setting up a mortgage pass-through securities is an example of:

Securitisation is the financial process of pooling homogeneous illiquid assets—such as residential mortgages—and repackaging their cash flows into marketable securities like…

Choose your answer

Banker sale of a mortgage portfolio by setting up a mortgage pass-through securities is an example of:

Select one answer
Answer and explanation

Correct answer D

Securitisation is the financial process of pooling homogeneous illiquid assets—such as residential mortgages—and repackaging their cash flows into marketable securities like mortgage pass-through securities for sale to capital market investors. This allows banks to remove assets from their balance sheets, recycle liquidity, and transfer credit risk.

Practice for these exams

  • UGC NET Commerce

Related question papers

Related exam syllabi

Related questions in this topic