The threat which the LTV Steel bankruptcy case posed to the core tenets undergirding the concept of securitization may have been fleeting, but market participants were nonetheless concerned last week that the lack of a litigated decision in the case would leave the door open for "true-sale"-related attacks to re-emerge (see Observation, p.20).

In light of this, many market observers have turned their attention to a largely ignored piece of pending federal legislation that would provide for automatic "true sale" treatment of many sales of assets into securitization trusts (see Observation, p.14). A little-noticed set of amendments contained in the Bankruptcy Reform Act - not adapted into law yet - could potentially revamp the entire process of true sale analysis, creating a safe harbor' provision that would permit a transferor to retain an interest in the issuer's securities.

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