Schweser-Book5-SS15-R59-PG127-Fig1 Whole Loan Sales versus Securitization in the European Market Distinguishing point no-1 -------------------------------- Securitization - Accounting rules will require assets to be recognized on the bank’s Balance Sheet. Whole Loan Sales - Assers are removed from the bank’s Balance Sheet. What do they mean by this???
It is a confusing chart. The line above it indicates that the chart is in regards to funding sources for European banks. So I think it means that, in Europe, if a loan originator sells a whole loan the assets are removed from a the loan originators B/S. But if the originator securitizes the loans themselves, they must still hold the value of the loans on the B/S.
Europe gives mortgage lender 2 options to choose from 1. Securitization OR 2. Whole Loan Sales So Page-3 Table-1 otta here sums it all up http://www2.standardandpoors.com/spf/pdf/products/060605_whole_loan_salesSNAP.pdf