Conduit finance

Conduit finance,

Definition of Conduit finance:

  1. The use of special purpose vehicles (SPV) by banks and other financial institutions to raise short-term financing. The SPV holds the financial assets, such as loans, and uses these funds to back highly rated commercial paper. The assets of the SPV are generally not held on the financial institutions balance sheet.

Meaning of Conduit finance & Conduit finance Definition