Structured finance can play a role in freeing the Eurozone from its debt mire, said London-based boutique shop Bishopsfield Capital Partners in a report released today.
Drawing interesting parallels, authors Mike Nawas and Amir Khan argue that tools emerging markets have employed in the past to overcome unwieldy debt can be brought to bear for Eurozone countries in their current crisis.
The report says that structured finance can complement the European Financial Stability Facility and the fiscal rehabilitation these countries must institute in order to cure their problems.
The most salient assets for monetization are real-estate related. The report details three approaches: sale and leaseback financing; structured sovereign bonds backed by lease receivables, and structured sovereign bonds backed by rental and disposal flows.
“The techniques are tried and tested, [and] often aim to enhance credit profile through resilient structures and contribute to three key objectives of fiscal rehabilitation: deleveraging, enabling future (re)-financing on competitive terms and stimulating long-term economic growth," the report said.
The six-page report is attached below.