The Asset Covered Securities Act, 2001 establishes a regulatory framework for the issuance and management of asset covered securities within designated credit institutions. It outlines the roles and responsibilities of the Central Bank as the regulatory authority, as well as the designation process for credit institutions seeking to participate in this market. The Act also delineates the conditions necessary for maintaining cover assets pools, stipulating the types of assets that may be included to secure issued securities.

Furthermore, the Act delineates the implications of insolvency for designated institutions, ensuring that the rights of preferred creditors are upheld, and allows for the appointment of cover-assets monitors to oversee compliance with the Act. Regulatory provisions empower the Authority to issue notices and regulations, thereby facilitating the operational integrity of asset covered securities.