Featured Product

    ESMA Defines Standards for Implementation of Securitization Regulation

    July 16, 2018

    ESMA issued the first set of technical standards under the Securitization Regulation, which contain both draft regulatory and implementing standards (RTS/ITS). The standards include draft regulatory technical standards specifying the information that the originator, sponsor, and Securitization Special Purpose Entity (SSPE) are required to provide to comply with the STS notification obligations (Article 27(6) of the Securitization Regulation). They also include draft implementing technical standards to establish the templates to be used for the provision of the STS notification (Article 27(7) of the Securitization Regulation) and the draft regulatory technical standards specifying the information to be provided to the competent authorities in the application for the authorization of a third party to assess the compliance of securitizations with the STS criteria (Article 28(4) of Securitization Regulation).

    With respect to the notification templates for STS securitizations, the draft technical standards specify the information and format that the originators and sponsors of securitization products are required to notify to ESMA if a securitization transaction meets the STS requirements. The STS notification is a necessary step to apply for STS preferential capital treatment. The STS notification standardized templates distinguish between non-Asset Backed Commercial Paper (ABCP) securitization, ABCP transaction, and ABCP program. The STS notification needs to include a confirmation, concise explanation, or detailed explanation about why the securitization transaction satisfies each of the STS criteria. This obligation is proportionate, as some criteria require greater explanation than others. The notification process also includes a cross-referencing system to investment prospectuses, if any, to avoid duplication of disclosure requirements.

    The technical standards contain detailed arrangements to implement the new European regulatory framework for securitizations, which is intended to promote simple, transparent, and standardized (STS) securitizations. ESMA has submitted for endorsement its final draft regulatory and implementing standards to EC. These standards will contribute to delivering a regulatory rulebook for European securitization markets. Regarding the joint ESA technical standards on the clearing obligation under the amendments to EMIR introduced by the Securitization Regulation, ESAs inform that they will require additional time beyond the July 18, 2018 deadline for finalization of the draft technical standards.These standards shall enter into force on the twentieth day following that of their publication in the Official Journal of the European Union. The regulatory technical standards on information to be provided in the application for the authorization of a third party verifying STS compliance shall apply from January 01, 2019.

     

    Related Links

    Keywords: Europe, EU, Banking, Securities, STS Securitization, STS Verification, Technical Standards, Securitization Regulation, ABCP Securitization, Notification Templates, ESMA

    Related Articles
    News

    EBA Updates List of Validation Rules for Reporting by Banks

    EBA issued a revised list of validation rules with respect to the implementing technical standards on supervisory reporting.

    September 10, 2020 WebPage Regulatory News
    News

    EBA Responds to EC Call for Advice to Strengthen AML/CFT Framework

    EBA published its response to the call for advice of EC on ways to strengthen the EU legal framework on anti-money laundering and countering the financing of terrorism (AML/CFT).

    September 10, 2020 WebPage Regulatory News
    News

    NGFS Advocates Environmental Risk Analysis for Financial Sector

    NGFS published a paper on the overview of environmental risk analysis by financial institutions and an occasional paper on the case studies on environmental risk analysis methodologies.

    September 10, 2020 WebPage Regulatory News
    News

    MAS Issues Guidelines to Promote Senior Management Accountability

    MAS published the guidelines on individual accountability and conduct at financial institutions.

    September 10, 2020 WebPage Regulatory News
    News

    APRA Formalizes Capital Treatment and Reporting of COVID-19 Loans

    APRA published final versions of the prudential standard APS 220 on credit quality and the reporting standard ARS 923.2 on repayment deferrals.

    September 09, 2020 WebPage Regulatory News
    News

    SRB Chair Discusses Path to Harmonized Liquidation Regime for Banks

    SRB published two articles, with one article discussing the framework in place to safeguard financial stability amid crisis and the other article outlining the path to a harmonized and predictable liquidation regime.

    September 09, 2020 WebPage Regulatory News
    News

    FSB Workshop Discusses Preliminary Findings of Too-Big-To-Fail Reforms

    FSB hosted a virtual workshop as part of the consultation process for its evaluation of the too-big-to-fail reforms.

    September 09, 2020 WebPage Regulatory News
    News

    ECB Updates List of Supervised Entities in EU in September 2020

    ECB updated the list of supervised entities in EU, with the number of significant supervised entities being 115.

    September 08, 2020 WebPage Regulatory News
    News

    OSFI Identifies Focus Areas to Strengthen Third-Party Risk Management

    OSFI published the key findings of a study on third-party risk management.

    September 08, 2020 WebPage Regulatory News
    News

    FSB Extends Implementation Timeline for Framework on SFTs

    FSB is extending the implementation timeline, by one year, for the minimum haircut standards for non-centrally cleared securities financing transactions or SFTs.

    September 07, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5796