EY and the World of Structured Finance

EY, a global leader in professional services, plays a significant role in the complex world of structured finance. Its involvement spans various aspects, offering advisory, assurance, tax, and transaction services to participants across the structured finance ecosystem. This includes originators, issuers, investors, servicers, and regulators.

Key Service Areas

Advisory Services: EY’s advisory teams provide strategic guidance to clients navigating the complexities of securitization and structured products. This includes helping clients design and implement efficient structures, manage risks, and optimize their capital structures. Their expertise covers areas like asset-backed securities (ABS), mortgage-backed securities (MBS), collateralized loan obligations (CLOs), and other specialized financing vehicles.

Assurance Services: EY’s assurance practices are crucial for ensuring the integrity and transparency of structured finance transactions. They perform audits of issuers and servicers, assessing compliance with regulatory requirements and internal controls. This is particularly vital for maintaining investor confidence and the overall stability of the market. Their work often involves detailed reviews of collateral pools, cash flow modeling, and compliance with securitization regulations.

Tax Services: Structured finance transactions have intricate tax implications. EY’s tax specialists advise clients on tax-efficient structuring, cross-border considerations, and compliance with relevant tax laws. They help clients minimize their tax liabilities while ensuring compliance with evolving tax regulations both domestically and internationally.

Transaction Services: EY supports clients involved in the buying, selling, and restructuring of structured finance assets. This includes due diligence, valuation, and financial modeling. Their transaction services help clients make informed decisions regarding investments in and divestitures of structured products.

Focus and Expertise

EY’s structured finance practice typically focuses on several key areas:

• Traditional Securitization: Supporting clients in securitizing assets like auto loans, credit card receivables, and mortgages.
• Alternative Credit: Working with private credit funds and other non-bank lenders on securitizing their portfolios.
• Real Estate Finance: Advising on CMBS (Commercial Mortgage-Backed Securities) and other real estate-related structured products.
• Infrastructure Finance: Supporting the financing of infrastructure projects through securitization and other structured solutions.

Impact and Market Role

EY’s presence in structured finance contributes significantly to the market’s efficiency and transparency. By providing rigorous assurance, insightful advisory services, and expert tax guidance, EY helps foster investor confidence, enabling capital to flow more efficiently through the financial system. Their involvement helps ensure regulatory compliance and promotes best practices within the structured finance industry.

In conclusion, EY serves as a critical player in the structured finance landscape, offering a comprehensive suite of services that support participants in navigating the complexities of this evolving market. Their expertise contributes to the growth and stability of structured finance, facilitating access to capital and driving economic activity.