Here’s a Bond Backed by Dirty Laundry – Another esoteric deal to hit the market

Coming soon to markets: a bond deal backed by … dirty laundry?

The $400 million of asset-backed securities (ABS) from Alliance Laundry Systems is thelatest example of wacky assets being bundled into bonds that are then put up for sale to yield-hungry investors. According to a ratings report from Standard & Poor’s, the bond’s payments ultimately depend on people’s dirty laundry, or at least on their washing it. The deal is backed by a pool of equipment loans used to finance the purchase of washing machines.

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