Friday November 24 2017
News Source: Fund Regulation
Focus: Other
Type: General
Country: European Union
On 20 November 2017, the Council of the European Union adopted rules aimed at facilitating the development of a securitisation market in Europe.
The new rules are part of the EU’s plan to develop a fully functioning capital markets union by the end of 2019. Developing a securitisation market will help create new investment possibilities and provide an additional source of finance, particularly for SMEs and start-ups.
The agreement with the Parliament covers two regulations:
- The 2017 regulation on securitisation sets rules on securitisations and establishing criteria to define STS securitisation
- The 2017 regulation on Capital Requirements for positions in securitisation
The first brings together rules that apply to all securitisations, including STS securitisation, that are currently scattered amongst different legal acts. It thus ensures consistency and convergence across sectors (such as banking, asset management and insurance), and streamlines and simplifies existing rules. It also establishes a general and cross-sector regime to define STS securitisation.
The text amending regulation 575/2013 sets out capital requirements for positions in securitisation. It provides for a more risk-sensitive regulatory treatment for STS securitisations.
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