CFM20030b - Securitisation: basic structures: example of a master trust structure

Basic master trust structure

Diagram of a basic master trust structure

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A Master Trust Structure is used to enable a series of assets by the same originator.

A trustee company is formed which holds the equity investment in an intermediate investment holding company on behalf of a charitable trust.

The intermediate investment holding company has a number of subsidiaries which would include:

• previous securitisation SPVs,
• the current securitisation SPVs, and
• future securitisation SPVs

In order to raise finance for the purchase of the assets, the current securitisation SPV issues bonds, with interest and principal, to third party investors.

Any residual profit left in the issuer SPV is passed back to the charitable trust.