What is Special Purpose Vehicle (SPV) Company?

What Is an SPV (Special Purpose Vehicle) Anyway?

In this video I try to explain in very simple way, what exactly is SPV. Generally, If the SPV fails, the parent company is unaffected. If the mother parent goes bankrupt, the SPV is protected.

A SPV, often known as a special purpose entity (SPE), is a subsidiary established by a parent company to mitigate financial risk. Its legal status as a separate company guarantees that it will be able to meet its obligations even if the parent firm fails. Because of this, a special purpose vehicle is frequently referred to as a bankruptcy-remote entity.

[leratorambau]

VERY GOOD EXPLANATION. THIS HELPED ME FORM MY EXAM.WELL DONE

[humility]

Thanks Asif, your delivery is of high quality and makes any concept really easy to understand!

[masturafadzillah]

Thanks your explanation is very easy to understand!!

[SH_]

Example made the concept clear....thank you

[krishnabind]

very helpful, clear and concise explanation. Keep it up!

[Danishletslearn]

Very good explanation. Most underrated educator like me 😁

[sinyeelaw]

thanks! understand clearly after watching this

[randeedelossantos]

thanks very precise and easy to understand..

[ashanieash]

thanks for this video. I actuually have a presentation on it for financial service class

[Ultimatepawn]

Great explanation. Whats in it for the bank in investing in the spv of there's no guarantor like the first example?

[ntcuongct]

With a SPV company, how do they securitize assets so that they can collect money from investors and transfer it to the parent company?

[bharathnatarajan]

Can you explain about intermediate and blocker funds

[tigerbhurtel]

Why would the banks invest 9 million in that company if there is no security of loan? Thanks
And the owner invests only 1 million?

[AlexeyTartyshev-fg]

the bank would not lend to SPV for exactly the same reason

[sumitkumar-klrk]

So that's why so much corruption is there and always some company cheat bank through this special purpose vehicle

[ieqxvoy]

Should the main company own 50% of the SPV in case of real estate??