Multiple choice

Which of the following is a function of a securitisation company?

  1. Acquisition of loan transaction from the lender

  2. Help the lender in recovery by sale of charge property

  3. Take legal steps against the defaulter borrower on behalf of the lender

  4. Acquisition of financial asset from the originator
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Section 5 provides for the acquisition of rights or interests in financial assets of any bank or financial institution by SCO/RCO, notwithstanding any thing contrary contained in any agreement or any other law for the time being in force, in either of the following manner: Issuing a debenture or bond or any other security in the nature of debenture, as consideration agreed upon by a SCO/RCO and bank/financial institution, incorporating therein the terms and conditions of issue. Entering into an agreement with bank/financial institution for the transfer of such financial assets on such terms and conditions as may be agreed upon.

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