ESMA Consults on Technical Standards on Securitization Requirements
ESMA published three consultation papers on the draft technical standards implementing the Securitisation Regulation. The Regulation establishes a general framework for securitization and creates a specific framework for simple, transparent, and standardized (STS) securitisation. The consultation is open for feedback until March 19, 2018. ESMA will use the feedback received to help finalize its draft technical standards and expects to publish a final report in July 2018 (for the STS notification and third-party application requirements) and by the end of 2018 (for the reporting requirements and operational standards/access conditions).
The Regulation requires certain information to be reported about securitizations to repositories, including details of their underlying exposures, details of the securitization structure, and information on the securitization cash flows. The securitization repositories will be registered and supervised by ESMA. In addition, securitizations seeking to be designated as STS must fulfil additional criteria and notify ESMA of their fulfilment of these criteria. Finally, third-party entities may seek to be authorized by a national competent authority to assess the compliance of securitizations with the STS criteria. The Regulation includes a number of mandates for ESMA to draft technical standards on these provisions. Accordingly, ESMA’s just-published consultation papers seek stakeholder views on:
- The contents and format of underlying exposures and investor report templates, which aim to meet the reporting requirements of the Regulation
- The operational standards for providing these reports to securitization repositories and for accessing this information from securitization repositories; moreover, the specific conditions for the entities specified in the Regulation to access information from securitization repositories
- The contents and format of the notification to ESMA of a securitization’s STS status
- The application requirements for third-party entities seeking to be authorized as providers of STS verification services
Related Link: Press Release
Comment Due Date: March 19, 2018
Keywords: Europe, EU, Securities, Securitization Framework, STS Securitization, Reporting Requirements, ESMA
Featured Experts
David Fihrer
Skilled life insurance actuary; subject matter expert on IFRS 17 and source of earnings
Salman Siddiqui
ESG and climate expert for P&C insurance; IFRS 17 specialist and chartered accountant; extensive experience in both life and non-life insurance, with focus on capital management, financial performance, and financial reporting.
Previous Article
IMF Reports on 2017 Article IV Consultation with Russian FederationNext Article
OCC Proposes Revisions to its Stress Testing RuleRelated Articles
BIS and Central Banks Experiment with GenAI to Assess Climate Risks
A recent report from the Bank for International Settlements (BIS) Innovation Hub details Project Gaia, a collaboration between the BIS Innovation Hub Eurosystem Center and certain central banks in Europe
Nearly 25% G-SIBs Commit to Adopting TNFD Nature-Related Disclosures
Nature-related risks are increasing in severity and frequency, affecting businesses, capital providers, financial systems, and economies.
Singapore to Mandate Climate Disclosures from FY2025
Singapore recently took a significant step toward turning climate ambition into action, with the introduction of mandatory climate-related disclosures for listed and large non-listed companies
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
EBA Proposes Standards Related to Standardized Credit Risk Approach
The European Banking Authority (EBA) has been taking significant steps toward implementing the Basel III framework and strengthening the regulatory framework for credit institutions in the EU
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
