General Information & Client Service
  • Americas: +1.212.553.1653
  • Asia: +852.3551.3077
  • China: +86.10.6319.6580
  • EMEA: +44.20.7772.5454
  • Japan: +81.3.5408.4100
Media Relations
  • New York: +1.212.553.0376
  • London: +44.20.7772.5456
  • Hong Kong: +852.3758.1350
  • Tokyo: +813.5408.4110
  • Sydney: +61.2.9270.8141
  • Mexico City: +001.888.779.5833
  • Buenos Aires: +0800.666.3506
  • São Paulo: +0800.891.2518
July 04, 2017

Yves Mersch, the ECB Executive Board Member, spoke at the 5th Anniversary of European Data Warehouse in Frankfurt. He discussed the to date contributions of the Eurosystem asset-backed securities (ABS) loan-level data initiative and highlighted that work still remains in this area.

Mr. Mersch highlighted the importance of transparency requirements for ABS products and discussed the reasons for ECB’s prioritization of ABS transparency. He emphasized that ECB has made a significant effort to ensure a high degree of transparency in European ABS by promoting the loan-level data initiative and that this initiative had an important contribution in the discussion on simple, transparent and standardized (STS) securitizations. It provides high-quality information that allows for informed credit risk assessments of ABS, either on the basis of the individual underlying loans, or on the basis of the aggregated summary information and enabled financial actors as well as policymakers to better assess the embedded risks in securitized portfolios. The final compromise version of the STS regulation, which was published last week, is significant as it creates, for the first time, a system of registration and supervision for ABS data repositories established in the EU. These securitization repositories will be subject to the same ongoing governance, technical, and operational requirements as trade repositories under the EMIR framework.


The securitization repositories will be expected to store not just loan-level data, but also all other documentation that the regulation requires originators, sponsors, and issuers to disclose under its transparency rules. The repositories will be registered, authorized, and supervised by ESMA. Furthermore, ESMA will be tasked with developing regulatory technical standards on the requirements for securitization depositories in the coming 18 months. While ECB welcomes the finalization of STS regulation, it has concerns regarding some aspects of the STS regulation. For example, providing a role in the legislation for third parties in the STS certification process introduces moral hazard for investors, as investor would have fewer incentives to undertake independent due diligence. Additionally, it would increase complexity and burden public resources, given the need to supervise such third parties separately. The compromise text no longer requires originators and sponsors to disclose the actual transaction contracts. Instead, this transparency enhancement has been weakened so a summary of the relevant documentation will also be accepted. This is a weaker requirement than the current provisions of Article 8b of the Credit Rating Agencies Regulation. These and other aspects will need to continue to be assessed as the regulatory technical standards become available in the coming months.


He also discussed non-performing loan (NPL) register as a new frontier for EU-wide transparency. One possibility to address the large stock of NPLs could be to create an EU-wide template and reporting system for such loans, alongside minimum standards for transparency. Efforts to enhance the transparency and standardization of NPLs could foster the creation of a NPL market, said Mr. Mersch .


Related Links


ECB Loan-Level Initiative

Keywords: Europe, ECB, Banking, Securities, NPL, ABS Loan-Level Initiative

Related Articles

EBA Publishes Reports Monitoring the Implementation of Basel III in EU

EBA published two reports measuring the impact of implementing the final Basel III reforms and monitoring the implementation of liquidity measures in EU.

March 20, 2019 WebPage Regulatory News

BCBS Publishes Results of Survey on Proportionality in Bank Regulation

BCBS published a report presenting the results of a survey conducted on proportionality practices in bank regulation and supervision.

March 19, 2019 WebPage Regulatory News

US Agencies Adopt Interim Rule to Facilitate Transfers of Legacy Swaps

US Agencies (FCA, FDIC, FED, FHFA, and OCC) are adopting and inviting comments on an interim final rule.

March 19, 2019 WebPage Regulatory News

EIOPA Requests Data on LTG Measures from Insurers Under Solvency II

EIOPA has requested the European Economic Area insurance undertakings, which are subject to Solvency II, to provide information on the long-term guarantee (LTG) measures.

March 18, 2019 WebPage Regulatory News

PRA Proposes Reporting Amendments to Pillar 2 Liquidity Framework

PRA proposed (CP6/19) regulatory reporting amendments and clarifications to the Pillar 2 liquidity framework for banks in UK.

March 18, 2019 WebPage Regulatory News

EBA Single Rulebook Q&A: Third Update for March 2019

EBA published answers to seven questions under the Single Rulebook question and answer (Q&A) updates for this week.

March 15, 2019 WebPage Regulatory News

OCC Updates Recovery Planning Booklet of the Comptroller's Handbook

OCC updated the Recovery Planning booklet of the Comptroller’s Handbook.

March 15, 2019 WebPage Regulatory News

CFTC and MAS Announce Mutual Recognition of Derivatives Trading Venues

CFTC and MAS announced the mutual recognition of certain derivatives trading venues in the U.S. and Singapore.

March 15, 2019 WebPage Regulatory News

EBA Publishes Report on Convergence of Supervisory Practices Across EU

EBA published annual report on the convergence of supervisory practices in EU.

March 14, 2019 WebPage Regulatory News

CPMI-IOSCO Publish Update to Level 1 Assessment of PFMI Implementation

CPMI and IOSCO jointly updated the Level 1 Assessment Online Tracker on monitoring of the implementation of the Principles for financial market infrastructures (PFMI).

March 14, 2019 WebPage Regulatory News
RESULTS 1 - 10 OF 2763