This section allows cross-market comparisons.
Glossary Definition
Overcollateralization

Transfer of receivables or other assets into a trust or corporate special-purpose vehicle as collateral for a loan in amounts greater than required to meet the expected principal, interest and service payments. The amount of over-collateralization (usually 5% to 10%) is determined by the rating agencies and the underwriters or placement agents. Amount of Overcollateralization depends upon the quality of the assets, other credit enhancement that may be available, the risk of the structure, the nature and condition of the industry in which the financial assets (usually loans) are generated, general economic conditions and, in the case of foreign-based securitizations, the sovereign risk.