Structured and Leveraged Finance
Dates:
October 14 - 16, 2009
October 14 - 16, 2009
Location:
Prague, Mövenpick Hotel
Prague, Mövenpick Hotel
Price:
EUR 2,100
EUR 2,100
Lecturer:
Søren Plesner
Søren Plesner
- Introduction to Structured Finance
- Asset Securitization
- CDO’s and Synthetics
- Leveraged and Acquisition Finance
- Management Buy-Outs and Buy-Ins
- Mezzanine Finance
- Structured Credit Products
The purpose of this seminar is to give you a thorough introduction to “structured finance” and a good understanding of how these financing techniques are used to finance acquisitions and asset portfolios.
We start with a brief introduction to “structured finance” and we give an overview of the different types of “structured finance” transactions and their uses.
We then explain in-depth how “asset securitization” can be used as a financing and risk management tool, and we give an overview of different types of “securitization” transactions. We take a closer look at the various elements in the structuring of a securitization transaction. We explain the role of the “Special Purpose Vehicle” (SPV) and discuss the legal aspects in setting up such an SPV. Further we explain techniques for credit enhancement and for payment management.
We present and explain a number of specific structures: Securities backed by home equity loans and “subprime” mortgages, commercial receivables, auto loans, credit card loans. We also present examples of “future flow” and of “intellectual property” securitizations. In each case, we explain the main deal features, and we illustrate with real-life case studies. We also explain the mechanics, pricing and risks of mortgage backed securities and their derivatives.
Further, we look at “Collaterized Debt Obligations” - the securitization of bank loans, bonds and other financial assets. We explain how these structures are used to transfer risk, to obtain funding of illiquid asset portfolios, to obtain regulatory relief and to enhance the return on capital of banks with high funding levels. We give practical, real-life examples of these structures, and we explain their pricing and risk characteristics.
We then explain how “leveraged finance” is used to fund acquisitions of companies or parts of companies by an existing internal management team, an external management, or a third party (acquisition). We also discuss how the financial and structural risks of leveraged financing transactions can be identified, analyzed and managed and how you can use leveraged loan CDS to gain or remove exposure to these risks.
Finally, we explain how “mezzanine” finance can used to close the gap between equity and debt financing. We give examples of typical terms of mezzanine capital and illustrate how it is used to fund growth opportunities, new product lines, new distribution channels or plant expansions.
We start with a brief introduction to “structured finance” and we give an overview of the different types of “structured finance” transactions and their uses.
We then explain in-depth how “asset securitization” can be used as a financing and risk management tool, and we give an overview of different types of “securitization” transactions. We take a closer look at the various elements in the structuring of a securitization transaction. We explain the role of the “Special Purpose Vehicle” (SPV) and discuss the legal aspects in setting up such an SPV. Further we explain techniques for credit enhancement and for payment management.
We present and explain a number of specific structures: Securities backed by home equity loans and “subprime” mortgages, commercial receivables, auto loans, credit card loans. We also present examples of “future flow” and of “intellectual property” securitizations. In each case, we explain the main deal features, and we illustrate with real-life case studies. We also explain the mechanics, pricing and risks of mortgage backed securities and their derivatives.
Further, we look at “Collaterized Debt Obligations” - the securitization of bank loans, bonds and other financial assets. We explain how these structures are used to transfer risk, to obtain funding of illiquid asset portfolios, to obtain regulatory relief and to enhance the return on capital of banks with high funding levels. We give practical, real-life examples of these structures, and we explain their pricing and risk characteristics.
We then explain how “leveraged finance” is used to fund acquisitions of companies or parts of companies by an existing internal management team, an external management, or a third party (acquisition). We also discuss how the financial and structural risks of leveraged financing transactions can be identified, analyzed and managed and how you can use leveraged loan CDS to gain or remove exposure to these risks.
Finally, we explain how “mezzanine” finance can used to close the gap between equity and debt financing. We give examples of typical terms of mezzanine capital and illustrate how it is used to fund growth opportunities, new product lines, new distribution channels or plant expansions.
Asset Securitization
- Introduction to Asset Securitization
- Obtaining Financing and Risk Transfer through Securitization
- Types of Securitization Transactions
- Structuring Securitization Deals
- Setting Up the SPV
- Credit Enhancement Techniques
- Rating of Structured Securities
- Payment Management
12.00 - 13.00 Lunch
13.00 - 16.30 Asset Securitization (Continued)
- Securitization of Traditional Asset Pools
- Car loans
- Credit card receivables
- Future flows
- Intangible assets
- Asset-Backed Commercial Paper
- Mortgage-backed Securities
- Mortgage Lenders and “Agencies”
- Home Equity Loans and Subprime Mortgages
- Mortgage Derivatives
- REMICs, PAC’s, TAC’s and CMO’s
- IO/PO Strips and Inverse Floaters
- Case Studies and Exercises
Thursday, October 15
09.00 - 09.15 Brief recap
09.15 - 12.00 Collaterized Debt Obligations
- Concepts of CDO Transactions
- CDO Structures
- Collaterized Loan Obligations
- Collaterized Bond Obligations
- Arbitrage/Balance Sheet CDO’s
- Distressed Debt CDO’s
- ABS and Real Estate CDO’s
- Synthetic CDO’s
- Applications of CDO’s
- Regulatory Arbitrage
- Yield Enhancement
- Bond Market Arbitrage
- Managing Capital Ratio
- Improving Bank RAROC
- Case Studies and Exercises
12.00 - 13.00 Lunch
13.00 - 16.30 Leveraged and Acquisition Finance
- Introduction to Leveraged Finance
- Types of Leveraged Finance Transactions
- Management Buy-Outs/ Buy-Ins
- Leveraged Acquisitions
- Leveraged Build-Ups
- Leveraged Recapitalization
- Leveraged Loans
- Issuer Perspectives
- Investor Perspectives
- Valuation in Leveraged Finance
- Asset-Based Approaches
- Comparables-Based Approaches
- Sensitivity analysis
Friday, October 16
09.00 - 09.15 Recap
09.15 - 12.00 Leveraged and Acquisition Finance (Continued)
- Valuation in Leveraged Finance (Continued)
- Free Cash Flow Approaches (FCFF and FCFE)
- Workshop: Using different approaches to value acquisition target
- The LCDX and LevX Indices
- Synthetic Leveraged Loans
- Leveraged Loan CDS
- Risks of Leveraged Finance
- Credit risks
- Structural risk
- Interest Rate and FX Risk
- Tax Risks
12.00 - 13.00 Lunch
13.00 - 16.30 Mezzanine Finance
- Mezzanine Finance as an Alternative to Debt and Equity Financing
- Players in the Market for Mezzanine Finance
- Typical Terms of Mezzanine Finance Transactions
- Using Mezzanine Finance in Leveraged Acquisitions
- Case Study
Evaluation and Termination of the Seminar
