From the March 2010 issue of Treasury & Risk magazine

Juicing Receivables

Receivables securitization not only survived the financial crisis but thrived as funding sources dried up and companies looked to accelerate cash collection.

The recent credit crisis stigmatized securitization, the practice widely associated with the now infamous subprime mortgages and defaults of asset-backed securities. But the market for the securitization of trade account receivables
is alive and well, and continues to provide companies with low-cost and low-risk financing options.

Despite the heavy criticism of securitization, anecdotal evidence shows that companies have maintained interest in securitizing receivables. Even a recent change in the accounting treatment of securitization facilities to achieve more transparency won't curb that interest, according to experts.


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