Difference between revisions of "Class"

Latest revision as of 18:18, 16 February 2022

Definition

Class. The categorization of different tranches in Securitisation

Principal payments follow a certain schedule. Tranches that have priority over the other tranches in the deal, which are then referred to as the support or companion tranches.

Disclaimer

This entry annotates a FIBO Ontology Class. FIBO is a trademark and the FIBO Ontology is copyright of the EDM Council, released under the MIT Open Source License. There is no guarantee that the content of this page will remain aligned with, or correctly interprets, the concepts covered by the FIBO ontology.

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 == Definition ==
-'''Class'''. Planned Amortization Class tranche. PAC-2 refers to a support tranche that is given a scheduled payment structure like a PAC bond.
+'''Class'''. The categorization of different tranches in [[Securitisation]]
-Principal payment must follow a certain schedule. These tranches have priority over the other tranches in the deal, which are then referred to as the support or companion tranches. For example, let's say you have a deal with a PAC tranche and a support tranche (i.e., a tranche that is a support tranche and is therefore subordinate to the PAC tranche) that has a scheduled payment structure like you did with the PAC bond. That support bond then is called the PAC-2 bond. If you continue, and create another support tranche that also has scheduled payments, that would become the PAC-3 bond.
+Principal payments follow a certain schedule. Tranches that have priority over the other tranches in the deal, which are then referred to as the support or companion tranches.
 == Disclaimer ==