With much-appreciated industry consultation by the Australian Prudential Regulation Authority (APRA), Basel II has had a sensible application to the Australian securitisation market.
On January 1 2008, the Australian prudential standard for securitisation activities of authorised deposit-taking institutions (ADIs), Prudential Standard APS 120: Securitization (APS 120), issued by the APRA in response to Basel II, became effective.
APS 120 places some restrictions on ADIs. These may give non-ADI sponsored issuers and foreign ADIs an opportunity to structure products whose features would not be permitted in an ADI sponsored deal, and which attract investors, particularly in challenging market conditions. Of course...