Securitization is an innovative form of financing, a flexible and efficient way to attract long-term investments. Assets with predictable cash flows or rights on future cash flows (such as mortgage, loans, security portfolio, accounts receivables) are grouped and transformed into securities in the form of bonds which are then sold to investors. The concept of Asset Securitization means a new technique for raising funds.
Its core idea: write-off of financial assets from the balance sheet of the enterprise and their refinancing through the issue of securities.
Atmosphere will help to evaluate the possibility of securitization of cash flows/future cash receipts through the assessment of the customer's business model and business processes.
As a result, the customer shall receive a report on the possibility of securitization and a report with recommendations on the customer's business model and business processes.
Securitization unites non-liquid assets turning them into an investment instrument. Emission with engagement of a specialized company minimizes risks, including the risk of bankruptcy. Cash flows generated by the pool of assets are redirected to payments for issued bonds. The transaction structure is transparent, and the contractor risks are diversified. The credit quality is improved due to internal mechanisms, including tranche subordination.
Our Company may provide a wide range of securitization services:
- Co-organization of securitization transactions
- Bondholders representative
- Settlement agent
- Service agent/backup service
Atmosphere develops the transaction structure and performs modeling and structuring of the transaction in accordance with necessities of the investors.
The Company develops unified standards and qualification requirements for the portfolio of assets/agreements as well as projects in the form of monthly reports and tables included into the report of the service agent.
Atmosphere helps the originator to choose legal and tax advisors, a rating agency, and all parties participating in securitization transaction. The Company participates in organizing the establishment of a specialized legal entity for the transaction: SPV, which is protected from bankruptcy by legal and contractual framework. Develops the structure and main terms of the transaction, mechanisms for supporting credit quality.
The Company cooperates with all transaction parties and coordinates their activities during transaction realization.
Atmosphere has close working relations with banks and non-bank operating assets providers. the Company will help to structurize and find the most efficient and economically feasible financial solutions for each customer.
Securitization transactions are covered by a legal requirement to have a bondholders representative (BR) as a particular case of a backed bond. The main function of the BR is to control that the issuer fulfills their bond obligation and take measures aimed at protecting rights and legal interests of bondholders. The BR helps to reveal circumstances which may lead to infringement of bondholder's rights. The possible scope of BR's authority is wide. The BR is a new notion for Russian transactions; it was introduced by the law only in 2015.
Atmosphere has long experience in exercising authority similar to the BR as a part of a long-term work on the mortgage and financial market as a partner of the Federal Agency for Housing Mortgage Lending, providing services related to mortgage assets services, assets collection and management, including securitization transactions. Atmosphere has vast operational capabilities and service quality duly appreciated by the leading state operator in the Russian financial market. Atmosphere has won tenders as a service agent for mortgage securitization due to its highest rating.
Using all its experience, Atmosphere is ready to provide high quality services with proven business processes.
As a part of the structured financing Atmosphere develops an individual model which allows including any additional information concerning bonds, which the issuer wishes to give to investors, into the report. The Company creates a register for logging the issuer's cash flows.
Atmosphere offers the following services:
calculation of payments to participants of the transaction's infrastructure and investors in accordance with issue documents;
tracking trigger events which cause changes in distribution of cash flows upon occurring;
- providing reports of a settlement agent.
Atmosphere has been working as a service agent, including securitization transactions, for 10 years. The Company has been accompanying a portfolio of more than 7 billion rubles. The Company has the highest possible rating of the Federal Agency AHML JSC and has won tenders for choosing the service agents due to a constantly high level of services.
Portfolio behavior and bond yields depend on quality of services. It is extremely important that the activities upon which yields depend must not be affected by risks. A quality service for the pool of assets and monitoring of the service level are required to ensure it. The structure should also have an independent organization which can provide timely and quality support of the portfolio and act as a servicer; this is the back-up service.
Atmosphere offers cooperation in any of the three directions: primary service, main service, and back-up service.
Atmosphere offers high quality portfolio support based on a proven business model and developed Support Standards. Our Company guarantees that the customer's pool of assets is maintained in the same condition to make the portfolio generate a non-declining level of returns and avoid exceeding the preset acceptable default level.
Main service — supervision over primary servicers.
Atmosphere provides supervision over support quality: it includes monitoring of delay level reduction measures, payment collection, preparation of reports, distribution of funds, and customer service quality.
The Company makes the investors sure that the services are provided at a constantly high level of quality by being always ready to accept a coverage portfolio of assets for support.
Atmosfera offers 'hot' and 'cold' service (the term for accepting the portfolio is 60 and 90 calendar days respectively).