In this chapter we start with an introduction to the main characteristics of Pfandbriefe and discuss the risks associated with the product from an investor’s point of view. Our focus is on the two most common Pfandbrief types in Germany, the Mortgage Pfandbrief and the Public Pfandbrief. In Section 2.3 we then derive implications for Pfandbrief modelling by identifying the most important features which should be accounted for by a realistic Pfandbrief model. For a structured in-depth analysis of the legal framework and the risks inherent in a Pfandbrief, we refer to Spangler and Werner  and the extensive collection of Pfandbrief-related literature listed therein.
Unable to display preview. Download preview PDF.