ABS (Asset-Backed Securities): ABS is essentially a bond issued by a SPV, or a Special Purpose Vehicle. Its issue takes place by means of a securitization process (financial engineering process that allows an intermediary to place undivided financial assets, such as mortgages, as collateral for other (possibly more risky) assets.
The principle of the ABS is the same as for a normal bond: by subscribing to an ABS, the investor earns a coupon established with the intermediary on the basis of a maturity determined by the rate, which like a normal bond it can be fixed or variable.
The bank that uses this particular instrument "packages" different forms of credit (for example mortgages) through a mechanism defined securitization, and then sells the new product on the market (no longer a single credit but a multiplicity). The operation is designed to convey a large liquidity flow inbound.
