Many in this room will be well aware of terms such as re-securitisations, synthetic transactions, and revolving structures. These arrangements indeed add complexity, but I must emphasise that the majority of current EU ABSs are static pool, true sale structures, especially the SME ABSs we are interested in.
Another clear lesson from the Asian crisis is that widespread insolvencies in the nonfinancial sector can be even more difficult to remedy than banking sector problems. The absence of adequate bankruptcy laws and procedures has in many cases meant that there was an absence of established mechanisms for allocating the burden of excessive debt problems among the borrowers and the lenders.