The data made available to the rating agencies for analyzing the underlying private equity assets of CFOs are typically less comprehensive than the data for analyzing the underlying assets of other types of structured finance securitizations, including corporate bonds and mortgage-backed securities. Leverage levels vary from one transaction to another, although leverage of 50% to 75% of a portfolio's net assets has historically been common.
The various CFO structures executed in recent years have had a variety of different objectives resulting in a variety of different structures. These differences tend to relate to the amount of equity sold through the structure as well as to the leverage levels.
Private Equity CFOs
Since the advent of CFOs (ca. 2002), there have been only a handful of publicly announced private equity securitization transactions. Typically, owners of private equity assets will securitize a portfolio of funds as a way of generating liquidity without an outright secondary sale of the funds.
In 2006 Temasek Holdings completed $810 million securitization of a portfolio of 46 private equity funds[1]
SVG Capital has executed three CFO securitizations as part of its "Diamond" program, SVG Diamond (2004), SVG Diamond II (2006) and SVG Diamond III (2007).[2][3]
Tenzing (2004) — Securitization of private equity fund assets by Invesco
Pine Street (2003) — Securitization of private equity fund assets by AIG
Silver Leaf (2003) — Securitization of private equity fund assets by Deutsche Bank
