Electronically negotiated asset securitization
First Claim
1. A computer implemented method for securitizing a loan against an asset comprising:
- opening bidding using an electronic auction platform for a junior lienholder tranche (B tranche) for a first predetermined period of time;
closing by the electronic auction platform bidding in the B tranche, wherein when the B tranche is fully subscribed the purchase price is established;
opening bidding by the electronic auction platform in the A tranche for a second predetermined period of time;
closing bidding in the A tranche by the electronic auction platform;
wherein if the A tranche is not fully subscribed at closing;
(i) reducing a size of the B tranche by a seller specifiable amount via an input to the electronic auction platform; and
(ii) removing one or more bids of one or more investors in the B tranche that placed their bids last from the B tranche by the electronic auction platform, thereby shrinking a size of the B tranche and reducing the purchase price for the asset; and
(iii) reopening bidding by the electronic auction platform in the (A) tranche using the reduced purchase price for the asset.
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Accused Products
Abstract
An electronic negotiation auction platform derives final market pricing for and assembles the investor pool to fund a borrower'"'"'s loan request or to sell an existing debt instrument. The platform conducts the auction in two phases. The first phase involves junior lienholders, whereas the second phase involves senior lien holders. Phase I comprises establishment of a purchase price by junior lienholders (B) tranche given minimum return information. Phase II comprises subscription of the (A) tranche which, now has a defined value and full range of information to consider the safest of the investment vehicles for this asset. Competition among investors desiring to participate in the (A) tranche results in a lower yield for the (A) tranche and a higher yield for the junior lienholders if the (A) tranche is oversubscribed. This extra yield is passed on to junior lienholders, serving as incentive to participate in the junior tranche.
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Citations
20 Claims
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1. A computer implemented method for securitizing a loan against an asset comprising:
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opening bidding using an electronic auction platform for a junior lienholder tranche (B tranche) for a first predetermined period of time; closing by the electronic auction platform bidding in the B tranche, wherein when the B tranche is fully subscribed the purchase price is established; opening bidding by the electronic auction platform in the A tranche for a second predetermined period of time; closing bidding in the A tranche by the electronic auction platform; wherein if the A tranche is not fully subscribed at closing; (i) reducing a size of the B tranche by a seller specifiable amount via an input to the electronic auction platform; and (ii) removing one or more bids of one or more investors in the B tranche that placed their bids last from the B tranche by the electronic auction platform, thereby shrinking a size of the B tranche and reducing the purchase price for the asset; and (iii) reopening bidding by the electronic auction platform in the (A) tranche using the reduced purchase price for the asset. - View Dependent Claims (2, 3, 4, 5, 6, 7)
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8. An apparatus for securitizing a loan against an asset comprising:
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an operator terminal to enable an operator to establish a size of a junior lienholder tranche (B tranche); and an electronic auction platform coupled to the operator terminal, said electronic auction platform to control bidding by one or more potential bidders, wherein the electronic auction platform; (i) opens bidding for the junior lienholder tranche (B tranche) for a first predetermined period of time; (ii) closes bidding in the B tranche upon expiration of the first predetermined period of time, wherein when the B tranche is fully subscribed the purchase price is established; (iii) opens bidding in the A tranche for a second predetermined period of time; and (iv) closes bidding in the A tranche upon expiration of the second predetermined period of time; wherein if the A tranche is not fully subscribed at closing, the electronic auction platform; (i) reduces a size of the B tranche using a seller specifiable amount; (ii) removes one or more bids of one or more investors in the B tranche that placed their bids last from the B tranche, thereby shrinking a size of the B tranche and reducing the purchase price for the asset; and (ii) reopens bidding in the (A) tranche using the reduced purchase price for the asset. - View Dependent Claims (9, 10, 11, 12, 13, 14)
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15. A non-transitory computer readable medium having encoded thereon instructions for a processor to execute a method for securitizing a loan against an asset, said method comprising:
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opening bidding using an electronic auction platform for a junior lienholder tranche (B tranche) for a first predetermined period of time; closing by the electronic auction platform bidding in the B tranche, wherein when the B tranche is fully subscribed the purchase price is established; opening bidding by the electronic auction platform in the A tranche for a second predetermined period of time; closing bidding in the A tranche by the electronic auction platform; wherein if the A tranche is not fully subscribed at closing; (i) reducing a size of the B tranche by a seller specifiable amount via an input to the electronic auction platform; and (ii) removing one or more bids of one or more investors in the B tranche that placed their bids last from the B tranche by the electronic auction platform, thereby shrinking a size of the B tranche and reducing the purchase price for the asset; and (iii) reopening bidding by the electronic auction platform in the (A) tranche using the reduced purchase price for the asset. - View Dependent Claims (16, 17, 18, 19, 20)
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Specification