Pfandbriefe: Germany’s secret gamblers
Pfandbriefe are asset-backed bonds. But unlike US-style securitizations, the underlying assets remain on the issuing bank’s balance sheet. There is no special-purpose vehicle. The Pfandbrief institution is like one big SPV. Its designated mortgage or public-loan assets serve as an undifferentiated pool of collateral for all mortgage or public Pfandbriefe at once. The bank has to manage that pool to make sure its value and cashflows cover all Pfandbrief liabilities.
A trustee appointed by the federal banking supervisor BaKred checks periodically that the collateral is adequate and registers all the assets in the pool.
Access intelligence that drives action
To unlock this research, enter your email to log in or enquire about access
