What qualifies as a simple, transparent and standardised
One component of the EU's Capital Markets Union project is
to ensure that securitisations are carried out in a transparent
and risk-reflective manner, and that they are of high quality.
As with many other financial instruments, this more cautious
approach is a direct reaction to practices that were brought to
light by the financial crisis.
Two new regulations take effect in January 2019 that aim to
introduce a consolidated framework for securitisations in the
EU: the Securitisation Regulation and an accompanying framework
outlining the capital treatments of different types of
asset-backed deals (known as the Capital Requirements
Regulation or CRR). These have been in the pipeline since
The Securitisation Regulation introduces rules for simple,
transparent and standardised (STS) securitisations which cover
all asset-backed transactions, without differentiating
according to the type of investor – as was the case
under the previous...