CA Final · Advanced Financial Management · Securitization
An SPV acquires a loan pool from Arihant Housing Finance, which continues to collect instalments from borrowers and pass them to the SPV for a fee of 0.5% per annum on the outstanding pool. The pool outstanding at the start of the year is ₹80 crore, and the servicing fee is calculated on this opening balance. The fee payable for the year is:
The servicing fee is ₹40 lakh. Arihant acts as servicer and earns 0.5% on the ₹80 crore opening pool, which is ₹0.40 crore, equal to ₹40 lakh, paid from collections before investors are paid.
- A₹4 lakh
- B₹40 lakhCorrect
- C₹0.4 lakh
- D₹400 lakh
Explanation
Fee = 0.5% × ₹80 crore = ₹0.4 crore = ₹40 lakh. The ₹4 lakh option misplaces the decimal by one place (treating as 0.05%), and ₹400 lakh treats it as 5%.
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