Securitization has emerged as a powerful financial tool for economic development and capital formation in emerging markets. By transforming illiquid assets into tradable securities, it allows local businesses and financial institutions to access new sources of funding, diversify their investor base, and manage their balance sheets more efficiently. However, applying these sophisticated financial techniques in dynamic and less-developed markets presents a unique set of opportunities and challenges. Professionals who can navigate the complexities of volatile macroeconomic environments, distinct legal frameworks, and diverse risk profiles are in high demand, making this a critical area of expertise for career growth.

This intensive 10-day training course is designed to provide a comprehensive understanding of how securitization can be successfully implemented in emerging economies. We will explore the practical applications and strategic considerations that differ from traditional developed market structures. The curriculum covers everything from assessing political and currency risks to structuring deals that attract international investors. Through a blend of expert-led instruction, real-world case studies from across different regions, and interactive workshops, participants will gain the skills necessary to identify opportunities, mitigate challenges, and execute successful securitization transactions in these exciting and rapidly evolving financial markets.

Duration: 10 days

Target Audience:

• Emerging Market Investment Bankers
• Structured Finance Professionals
• Regulators and Government Officials
• Credit Analysts and Risk Managers
• Treasury and Corporate Finance Officers
• Private Equity and Venture Capital Professionals
• Legal Counsel for Financial Institutions
• International Development Finance Professionals

Objectives:

• Understand the key drivers and constraints of securitization in emerging markets.
• Analyze the unique legal, regulatory, and political risks involved.
• Evaluate the viability of different asset classes for securitization.
• Master the structuring process to attract both local and international investors.
• Identify and mitigate macroeconomic risks, including currency and interest rate volatility.
• Develop a framework for deal execution, from origination to closing.
• Analyze successful and unsuccessful case studies from various emerging regions.
• Appreciate the role of international financial institutions in market development.

Course Modules:

Module 1: Introduction to Emerging Market Securitization

• Why is securitization important for emerging markets?
• An overview of the current landscape and key players
• Comparing securitization in developed vs. emerging markets
• The role of financial innovation in economic development
• The potential and pitfalls of pioneering new markets

Module 2: Legal and Regulatory Frameworks

• The importance of a robust legal and regulatory infrastructure
• Key legal considerations for asset true sale and perfection of security
• Navigating different jurisdictions' insolvency laws
• Understanding local regulatory bodies and their requirements
• The impact of a lack of legal precedent on deal structuring

Module 3: Macroeconomic and Political Risk Analysis

• Identifying and quantifying country-specific political risks
• The effect of macroeconomic volatility on asset performance
• Analyzing currency risk and how to hedge it
• The role of local interest rates and inflation
• Dealing with sovereign risk in a securitization context

Module 4: Asset Classes in Emerging Markets

• Securitizing mortgage loans and auto loans
• Exploring other promising asset classes like micro-lending and trade receivables
• The challenges of securitizing non-traditional assets
• Assessing asset pool data quality and historical performance
• The importance of a reliable servicing infrastructure

Module 5: Deal Structuring for Emerging Markets

• Designing a structure to mitigate specific risks
• The importance of a simple, transparent structure
• The use of special purpose vehicles (SPVs) in an international context
• Structuring deals to meet the needs of different investor types
• Case studies in successful structural design

Module 6: Credit Risk Management and Underwriting

• Adapting credit risk models for emerging market data
• Challenges in underwriting standards and borrower profiles
• The role of local credit bureaus and data availability
• Managing servicing and collection risks
• Building a resilient credit risk strategy

Module 7: Currency and Interest Rate Risk Management

• The importance of matching currency denomination of assets and liabilities
• Using derivatives to hedge currency risk
• Strategies for managing local interest rate volatility
• The impact of foreign exchange controls
• Structuring deals with a dual-currency component

Module 8: Credit Enhancement and Investor Protection

• The role of credit enhancement in attracting foreign capital
• Adapting internal credit enhancements for emerging markets
• The use of guarantees and letters of credit from international banks
• The importance of overcollateralization in volatile environments
• Structuring triggers and covenants to protect investors

Module 9: The Role of International Investors

• Understanding the motivations of international investors in these markets
• The role of Development Finance Institutions (DFIs) and multilaterals
• Overcoming investor skepticism and information asymmetry
• The importance of international credit ratings
• Case studies on successful cross-border securitization deals

Module 10: Execution and Deal Closing

• The steps from deal origination to closing
• Managing the deal team, including legal, tax, and accounting advisors
• The importance of a robust due diligence process
• Overcoming operational and logistical challenges
• A practical walk-through of a deal timeline

Module 11: Post-Closing Monitoring and Surveillance

• The importance of ongoing performance monitoring
• Analyzing servicer reports and key performance indicators
• Communicating with investors and dealing with rating agencies
• Managing deal triggers and workout situations
• Best practices for reporting and transparency

Module 12: Innovations and Future Trends

• The rise of fintech-driven securitization
• Securitizing new assets like digital loans and mobile money receivables
• The use of green and social bonds in securitization
• The potential for blockchain and distributed ledger technology
• The role of securitization in addressing the UN Sustainable Development Goals

Module 13: Case Studies in Latin America

• Analysis of mortgage-backed securities in Mexico
• The growth of auto loan securitization in Brazil
• The impact of regulatory changes in the region
• Lessons learned from market crises and restructurings
• A deep dive into a specific successful transaction

Module 14: Case Studies in Asia and Beyond

• The development of the ABS market in India and Southeast Asia
• Securitization of microfinance loans
• Challenges and opportunities in the Middle East and Africa
• Cross-border deals and regional variations
• The future growth potential for these regions

Training Approach

This course will be delivered by our skilled trainers who have vast knowledge and experience as expert professionals in the fields. The course is taught in English and through a mix of theory, practical activities, group discussion and case studies. Course manuals and additional training materials will be provided to the participants upon completion of the training.

Tailor-Made Course

This course can also be tailor-made to meet organization requirement. For further inquiries, please contact us on: Email: info@skillsforafrica.org, training@skillsforafrica.org  Tel: +254 702 249 449

Training Venue

The training will be held at our Skills for Africa Training Institute Training Centre. We also offer training for a group at requested location all over the world. The course fee covers the course tuition, training materials, two break refreshments, and buffet lunch.

Visa application, travel expenses, airport transfers, dinners, accommodation, insurance, and other personal expenses are catered by the participant

Certification

Participants will be issued with Skills for Africa Training Institute certificate upon completion of this course.

Airport Pickup and Accommodation

Airport pickup and accommodation is arranged upon request. For booking contact our Training Coordinator through Email: info@skillsforafrica.org, training@skillsforafrica.org  Tel: +254 702 249 449

Terms of Payment: Unless otherwise agreed between the two parties’ payment of the course fee should be done 7 working days before commencement of the training.