Adjusting Securitisation Framework for COVID-19 Recovery

Summary

This regulation adjusts the EU securitisation framework to support economic recovery after COVID-19, specifically targeting non-performing exposures and promoting transparent securitisations.
9 26.04.2021
Other
economy
finance
european union

Key points

  • The regulation aims to support economic recovery by adjusting the securitisation framework used by financial institutions.
  • A new treatment for non-performing exposure (NPE) securitisations is introduced to address disproportionate capital requirements.
  • A specific framework is established for simple, transparent, and standardised (STS) on-balance sheet securitisations to expand lending capacity.
  • The regulation aligns the requirements for unfunded credit protection with the international Basel III framework.
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