Question

CRE CDOs were primarily vehicles for issuers to monetize assets and achieve arbitrage True False

CRE CDOs were primarily vehicles for issuers to monetize assets and achieve arbitrage

  1. True

    False

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Answer #1

CRE CDO was introduced with the ability of the collateral manager to reinvist principal proceeds for a period of time,trade collateral assets  for other than credit reasons,and include non-CUSIPed assets such as B-notes,rake bonds,mezzanine loans,and preffered equity.CDO technology has been applied to achieve new financing solutions.

SO, Commercial real estate collateralized debt obligations(CRE CDO)were primarily vehicles for issuers to monetize assets and achieve arbitrage and the given statement is completely true.

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