Registration Requirements
Regulation AB requires issuers of asset-backed securities to register with the SEC. In addition to the disclosure requirements of other, more traditional securities, asset-backed securities must provide the following information on the cover page of the prospectus:
- • Identity of the sponsor, depositor, and issuing entity
- • Identity of the asset types being securitized
- • Legend stating that securities represent the obligations of the issuing entity
- • Identification of the aggregate amount of all securities and each class of securities offered
- • Interest rate of each class of security
- • Disclosure of any credit enhancement or support for the security
A sponsor is the originating entity that sells or transfers its assets into the ABS. A depositor is a third party that receives assets from various originators and transfers the pooled assets into the ABS. The issuing entity is the SPV or trust in whose name the ABS is issued. If Wells Fargo, for example, pools its mortgages and transfers ownership of them to an SPV, Wells Fargo is a sponsor. The SPV is the issuing entity or issuer. If, on the other hand, Countrywide Finance buys up mortgages from various banks