Part A: Banks and other mortgage originators often securitise long-term assets like mortgages, to ensure liquidity. Briefly outline the process of bank securitisation [2 marks]

PART B: Sunshine Ltd plans to purchase or lease two heavy duty cranes for its building operations. As a finance manager, explain to the CFO the difference between direct finance lease and leverage finance lease. [3 marks]

PART C: Sunshine Ltd plans to issue debt to finance some newly identified projects. Explain to the CFO why it should seek to raise some debt funds direct from the capital markets and why some investors may be willing to provide debt funds directly. [2 marks]

INSTRUCTIONS:

1. TYPE YOUR ANSWER IN THE SPACE PROVIDED BELOW. 2. CLEARY LABEL EACH PART