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Abstract
The Reserve Bank of India (RBI) has released new regulatory capital guidelines in response to an increasing number of securitizations by Indian banks. But those guidelines have drawn criticism, despite comment that the one thing the Indian securitization market needs is greater regulation. India saw its first securitization-type transaction in the early 1990s. The early deals resembled secured lending, mainly against auto loans, and that asset class remains the largest by volume. In this sense, the Australian experience has been similar, with initial volumes being in one asset class that still remains predominant - home loan assets. Despite the shallow market, India has seen a fairly diverse range of securitization deals. Housing sector deals have grown in the last few years and alongside that there has been a healthy upward trend in RMBS. Equipment lease securitization has also been popular. In the last five years India has developed a sophisticated securitization market. But it has lacked consolidated central bank regulation. Some commentators have argued that one reason the Indian market still lacks diversification and depth is not simply its newness but the lack of a robust legal and regulatory structure to guide the development of assets and products.