Taiwan
SUPPLEMENT - THE 2004 GUIDE TO STRUCTURED FINANCE - June 22, 2004
Taiwan's Ministry of Finance (MOF) recently approved its first
real estate securitization project. The project is based on the
securitization of the building, land and rental income streams of
the IBM building, a commercial building in Taipei. This deal is
Taiwan's first approved real estate securitization project, and
represents another milestone in the development of Taiwan's
securitization market.
In a real estate securitization deal, an originator transfers
the relevant real estate property to a trustee, typically a bank
(in Taiwan, a trust is not a distinct legal entity from the
trustee). The trustee then issues notes to investors, with full
recourse against the entrusted building, land and tenancy
agreements. The project must be structured pursuant to a
securitization plan in compliance with the Real Estate
Securitization Law (the RESL) and approved by the MOF. To comply
with the RESL, the plan must provide details for various
transactions to transfer the title of the building and the land
from the originator...
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