No abstract

This study analyzes the impact of securitization on the soundness of financial institutions through the two main securitization products in Brazil: Credit Rights Investment Funds (FIDC) and Real Estate Receivables Certificates (CRI). On the basis of a panel data analysis regarding 92 financial institutions from 2003 to 2016, we performed several regressions for different samples and methods. The findings suggest that securitization may increase the insolvency risk. In particular, we observe that the effect on the insolvency risk caused by securitization from CRI operations is higher than from FIDC operations.