Effectenlagen

Effectenlagen, literally “securities layers,” is a term used to describe the layered structure of rights to cash flows and collateral in securitization and similar structured finance transactions. In such arrangements, a pool of underlying assets (for example loans or mortgages) is transformed into multiple classes of securities, each representing a different claim on payments and risk.

In practice, the layers operate under a cash waterfall. The senior tranche, or top layer, has the highest claim priority, receives payments first, and typically carries the lowest risk and lowest return. Subordinated or junior tranches absorb losses first, making them riskier but offering higher potential returns. Some transactions also include an equity or residual tranche that bears the residual risk and return after other layers are paid. The arrangement determines who gets paid and when, and it shapes the overall risk profile of the securitized package.

This layer structure is common in mortgage-backed securities (MBS), asset-backed securities (ABS), collateralized loan obligations (CLOs), and other securitization products. Investors select layers that match their risk appetite and return targets. Because the structure can be complex and involves multiple counterparties, transparency and careful risk assessment are important, and ratings on different layers may vary accordingly.

Note: In Dutch financial discourse, effectenlagen is not an official standardized term in all contexts and may be used descriptively to discuss the layered nature of securitized securities.

See also: securities, securitization, tranche, waterfall, collateralized debt obligation, asset-backed security.