A synthetic bond can behave very much like a real bond.
So consider the situation of a bank, which has made a bunch of loans, to 100 different companies. The companies all value their relationship with the bank, and the bank values its relationship with the companies. At the same time, however, the bank would like to free up some capital. It doesn't want to sell the loans outright -- so instead it creates a synthetic bond referencing those 100 credits, and sells that.
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