Net interest margin securities

Net interest margin securities

Net interest margin securities (or NIMS) is a type of financial instrument related to a securitization.

For example, New Century Financial Corporation -- the subprime mortgage lender that went into Chapter 11 bankruptcy in April 2007 -- sells the cash flows it receives from its mortgages in what is known as a mortgage backed security (which is basically a bundled set of loans that is sold to investors -- similar to a bond). Any excess cash flows derived from the mortgage receivable (after the investors of the mortgage backed security have been paid) is referred to as the "residual interest in securitizations" or just "residual." A NIMS is the sale of those residuals.


Wikimedia Foundation. 2010.

Игры ⚽ Нужен реферат?

Look at other dictionaries:

  • Net Interest Margin Securities - NIMS — A type of security that allows holders to access excess cash flows resulting from securitized mortgage loan pools. Excess cash flows from the securitized mortgage loan pools are transferred to a trust account through a NIMS transaction. From this …   Investment dictionary

  • Net interest income — (NII) is the difference between revenues generated by interest bearing assets and the cost of servicing (interest burdened) liabilities. For banks, the assets typically include commercial and personal loans, mortgages, construction loans and… …   Wikipedia

  • Net Interest Income — All firms can divide the balance sheet into assets and liabilities. For banks the assets are commercial and personal loans, mortgages, construction loans and securities. The liabilities are deposits from customers. The net interest income (NII)… …   Wikipedia

  • margin — the difference between the selling price and the purchase price of an item usually expressed as a percentage of the selling price. Compare mark up. Glossary of Business Terms Financial safeguards to ensure that clearing members (usually companies …   Financial and business terms

  • Margin — This allows investors to buy securities by borrowing money from a broker. The margin is the difference between the market value of a stock and the loan a broker makes. Related: security deposit ( initial). The New York Times Financial Glossary *… …   Financial and business terms

  • Margin (finance) — For the 2011 film, see Margin Call. In finance, a margin is collateral that the holder of a financial instrument has to deposit to cover some or all of the credit risk of their counterparty (most often their broker or an exchange). This risk can… …   Wikipedia

  • Net capital rule — The uniform net capital rule is a rule created by the U.S. Securities and Exchange Commission ( SEC ) in 1975 to regulate directly the ability of broker dealers to meet their financial obligations to customers and other creditors.[1] Broker… …   Wikipedia

  • margin — 1) The profit margin on sales of goods or services. It is often expressed as a percentage of revenue. See gross profit; gross profit percentage; net profit; net profit percentage See also contribution; mark up 2) The difference between the prices …   Big dictionary of business and management

  • margin — 1) The profit margin on sales of goods or services. It is often expressed as a percentage of revenue. See: gross profit, gross profit percentage, net profit, net profit percentage See also: contribution, mark up 2) The difference between the… …   Accounting dictionary

  • Mortgage-backed security — Securities Securities Bond Stock Investment fund Derivative Structured finance Agency security …   Wikipedia

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”