21
QuizMultiple Choice

Asset-backed Securities, Loan Sales, and Derivatives — Test

Question 21 • (AG Q4) Financial Literacy: 25-26 (JRush)

One bank sells its loan portfolios and another bank securitizes its loan assets. Both are essentially doing the same thing, although one takes longer than the other.

Answer
A
True
B
False

Explanation

False. Selling a loan portfolio transfers the loans directly to a buyer. Securitizing loans instead pools them and issues securities backed by the payments on those loans, so it is a different process and can take longer.

AI-written and checked against the verified answer.

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