Asset-Backed Commercial Paper


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Asset-Backed Commercial Paper

A short-term debt security issued by a corporation that is collateralized by some asset. In general, asset-backed commercial paper is secured by accounts receivables or something similar. It carries less risk than other commercial paper, which is unsecured. It is a highly liquid investment and forms part of the money market.
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Each of these fundamental assumptions about the asset-backed commercial paper market was undermined as a function of the kind of smashing of the atom of property that was effected by private sector innovation around derivatives and securitization.
The Federal Reserve's extended support for entire asset classes, such as home mortgages and asset-backed commercial paper, is unprecedented, as is its duration.
Innovations in Asset-Backed Commercial Paper. In 2003, additional innovation changed the internal dynamics of ABCP conduits.
In addition, four small towns in northern Norway acquired positions in asset-backed commercial paper created by Citigroup (Berglund 2007).
The company has received CAD4.4m as a partial return of principal from a CAD19.0m investment in third-party asset-backed commercial paper.
dollar-denominated certificates of deposit, bank notes, and outstanding asset-backed commercial paper from eligible issuers." Eighth through tenth are: Net Portfolio Holdings of Maiden Lane LLC, an entry representing troubled assets from the portfolio of the former investment bank Bear Stearns that the New York Fed absorbed to sweeten the takeover deal for the benefit of JPMorgan Chase; Net Portfolio Holdings of Maiden Lane II LLC, representing troubled mortgage-backed securities purchased from AIG, and Net Portfolio Holdings of Maiden Lane III LLC, representing troubled collateralized debt obligations purchased from AIG.
As reported by the Associated Press, "The Fed said it is creating a new entity to buy three-month unsecured and asset-backed commercial paper directly from eligible companies.
You see, at this level of banking, these Chucks loans and all others are all bundled together and called Asset-Backed Commercial Paper (ABCP).
And we will be increasing the capital requirements applied to short-term liquidity facilities for asset-backed commercial paper to the level that also applies to longer-term credit lines.
Zell said in a statement that Tribune has paid down $807 million of borrowings under the Tranche X Facility made possible by the proceeds from an asset-backed commercial paper program and the Newsday divestiture.
The company said earnings were affected negatively by a C$17.9 million writedown related to asset-backed commercial paper holdings.
In spite of the sound performance in Canada, the bottom line for the most recent 13 weeks was diminished by several after-tax items: a $26.1 million investment loss from Coutu's 31.7% share of Rite Aid, a $3 million provision related to the write-down of third-party asset-backed commercial paper and a $2.9 million adjustment to the previously recorded gain on the sale of the U.S.