Rule 144A
Asset-Backed Securities glossary · Regulatory, Syndication & Live Deal Processing
Definition
SEC rule permitting resale of restricted securities to Qualified Institutional Buyers (QIBs); the most common offering format for non-agency ABS.
Rule 144A in plain English
Normally, when a company sells securities to the public, it has to jump through heavy SEC registration and disclosure hoops. Rule 144A is a shortcut: it lets these bonds be sold and resold privately, but only to Qualified Institutional Buyers (QIBs) — huge, sophisticated professional investors like pension funds and insurance companies who are assumed to be able to look after themselves. Because it's faster and lighter on paperwork, it's the go-to format for most privately-issued (non-agency) asset-backed deals. Think of it as a members-only wholesale market: only big, expert buyers are let in, so the usual retail-shopper protections aren't required.
Practice Rule 144A
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