Italian overdue Healthcare invoices securitised

The unrated bonds were privately placed. They were secured by overdue invoices payable by Italian state-connected healthcare organisations. When they are overdue on paying their invoices, those invoices attract a penalty charge. The invoices therefore become more valuable, which attracts investors seeking higher yields.

The risk is the overdue invoices might never be paid in full.

It was revealed by the FT on 7 Jul 2020 that some of the assets backing the bonds were derived from Italian mafia activities - an embarrassment for the hedge funds and pension funds that had bought them