Blog
Octus on Credit: Securitizing Nontraditional Assets: Frequent Flyer Programs to Franchises
Jared Muroff, Manager, Distressed Debt
As interest rates have increased and lenders become more circumspect, many stressed borrowers have been exploring the securitization markets as a source for cheaper capital. This trend should continue as market participants wrestle with the impact of potential tariffs, providing lenders, sponsors and their advisors another arrow in their liability management quiver.
While securitizations of financial assets have long been a feature of the capital markets, recently we’ve seen borrowers securitize the cash flows associated with less traditional candidates–frequent flyer programs, lit and dark fiber networks or, in the case of the whole business securitization model, all the cash flows from restaurant franchisees.
While borrowers like the lower rates charged on these loans, lenders appreciate the ability to be closer to the cash flowing assets. As well, the higher ratings the asset-backed securities receive allow insurance and other financial companies to hold less regulatory capital against these assets, making them more capital efficient.
With this in mind, Octus has begun covering nontraditional securitizations as a new vertical with data sets for both whole business securitizations and those that only securitize a part of the business. Access the replay of our latest webinar to see the Octus team discuss current trends in the space and how recent cases like Hooters and TGI Fridays have been handled in bankruptcy court.
Continuing in the vein of subject matter expertise, on June 18th at 10 AM EST, Octus will be hosting a webinar on the rise of direct-to-device in the satellite space with three industry leaders, that is sure to make participants smarter on a topic of great importance in the telecom sector.
This publication has been prepared by Octus, Inc. or one of its affiliates (collectively, "Octus") and is being provided to the recipient in connection with a subscription to one or more Octus products. Recipient’s use of the Octus platform is subject to Octus Terms of Use or the user agreement pursuant to which the recipient has access to the platform (the “Applicable Terms”). The recipient of this publication may not redistribute or republish any portion of the information contained herein other than with Octus express written consent or in accordance with the Applicable Terms. The information in this publication is for general informational purposes only and should not be construed as legal, investment, accounting or other professional advice on any subject matter or as a substitute for such advice. The recipient of this publication must comply with all applicable laws, including laws regarding the purchase and sale of securities. Octus obtains information from a wide variety of sources, which it believes to be reliable, but Octus does not make any representation, warranty, or certification as to the materiality or public availability of the information in this publication or that such information is accurate, complete, comprehensive or fit for a particular purpose. Recipients must make their own decisions about investment strategies or securities mentioned in this publication. Octus and its officers, directors, partners and employees expressly disclaim all liability relating to or arising from actions taken or not taken based on any or all of the information contained in this publication. © 2025 Octus. All rights reserved. Octus(TM) and the Octus logo are trademarks of Octus Intelligence, Inc.