Mohammad Omar Faruk

Loan Securitization: a New Strategy to Resolve Mohammad Omar Faruk

Non-performing loan (NPL) is one of the most critical factors for the commercial banks because the immediate consequence of large amount of NPL can be a reason for the bank failure/loss. The securitization is, a very recent financial product, being used in the many developed and developing countries as a better solution for the NPL rather then removing from balance sheet as loan loss. This book lay out a proposal of how asset securitization, against NPL of bank, can be introduced in Bangladesh. The book sail to sell NPL to the SPE at a market rate of the loan or collaterals of the loan then the SPE issue the securities against the assets of the loan at a interest rate and maturity where different entities will be involved to facilitate the securitization process. The book also shows the securitization model, the problems and the prospects of implementing NPL in Bangladesh.