Featured Product

    BCBS Issues Framework for STC Short-Term Securitizations

    May 14, 2018

    BCBS issued the standard for capital treatment of simple, transparent, and comparable (STC) short-term securitizations. This standard supplements the criteria for identifying STC short-term securitizations, which BCBS issued jointly with IOSCO. The short-term STC framework takes effect immediately.

    The standard for capital treatment of STC short-term securitizations sets out additional guidance and requirements for applying preferential regulatory capital treatment for banks acting as investors in or as sponsors of STC short-term securitizations, typically in asset-backed commercial paper (ABCP) structures. The additional guidance and requirements in this standard are consistent with those for STC term securitizations set out in the Committee's July 2016 revisions to the securitization framework. 

    The criteria for identification of STC short-term securitizations take account of the characteristics of asset-backed commercial paper (ABCP) conduits, such as the short maturity of the commercial paper issued, the different forms of program structures, and the existence of multiple forms of liquidity and credit support facilities. Provided that the expanded set of STC short-term criteria are met, STC short-term securitizations will receive the same modest reduction in capital requirements as other STC term securitizations. 

    Similar to the STC framework for term securitizations, implementation of the STC short-term framework is not mandatory. Jurisdictions which consider that implementation costs exceed potential benefits retain the option not to implement the STC framework. The standard incorporates feedback collected during the public consultation, which was conducted in July 2017. Changes made include:

    • Setting the minimum performance history for non-retail and retail exposures at five years and three years, respectively
    • Clarifying that the provision of credit and liquidity support to the ABCP structure can be performed by more than one entity, subject to certain conditions

     

    Related Links

    Effective Date: May 14, 2018

    Keywords: International, Banking, STC Securization, ABCP Securitization, Capital Requirements, Basel III, IOSCO, BCBS

    Featured Experts
    Related Articles
    News

    FED Adopts Proposal to Implement Reporting Form for SCCL

    FED adopted a proposal to implement the Single-Counterparty Credit Limits (SCCL) reporting form (FR 2590; OMB No. 7100-NEW).

    November 20, 2019 WebPage Regulatory News
    News

    FED Proposes to Extend Initial Compliance Dates Under SCCL Rule

    FED published a proposal to extend, by 18 months, the initial compliance dates for foreign banks subject to the single-counterparty credit limit (SCCL) rule.

    November 20, 2019 WebPage Regulatory News
    News

    CBIRC to Strengthen Supervisory and Policy Support for SME Services

    CBIRC released a notification on strengthening supervision and guidance to enhance the quality and efficiency of financial services for "small and micro-enterprises" (SMEs).

    November 20, 2019 WebPage Regulatory News
    News

    APRA Publishes Approach to Regulating and Supervising GCRA Risks

    APRA published an information paper that sets out a more intensive regulatory approach to transform governance, culture, remuneration, and accountability (GCRA) practices across the prudentially regulated financial sector.

    November 19, 2019 WebPage Regulatory News
    News

    US Agencies Update Rule on Derivative Contracts Exposure Calculation

    US Agencies (FDIC, FED, and OCC) announced a final rule updating the way certain banking organizations are required to measure counterparty credit risk for derivative contracts under their regulatory capital rules.

    November 19, 2019 WebPage Regulatory News
    News

    US Agencies Finalize Rule to Amend Treatment of HVCRE Exposures

    US Agencies (FDIC, FED, and OCC) finalized a rule to modify the treatment of high volatility commercial real estate (HVCRE) exposures, as required by the Economic Growth, Regulatory Relief, and Consumer Protection (EGRRCP) Act.

    November 19, 2019 WebPage Regulatory News
    News

    US Agencies Finalize Changes to Rule on Supplementary Leverage Ratio

    US Agencies (FDIC, FED, and OCC) finalized changes to the capital requirement for banking organizations predominantly engaged in custodial activities, as required by the Economic Growth, Regulatory Relief, and Consumer Protection (EGRRCP) Act.

    November 19, 2019 WebPage Regulatory News
    News

    IAIS Consults on Guidance on Liquidity Risk Management for Insurers

    IAIS is seeking feedback on the draft application paper on liquidity risk management for insurers.

    November 19, 2019 WebPage Regulatory News
    News

    IAIS Publishes Application Paper on Recovery Planning

    IAIS published the final application paper on recovery planning, along with the resolution of comments on the draft application paper.

    November 18, 2019 WebPage Regulatory News
    News

    FSB Publishes Summary of November Meeting of RCG for MENA Region

    FSB published a summary of the November meeting of the Regional Consultative Group (RCG) for Middle East and North Africa (MENA).

    November 17, 2019 WebPage Regulatory News
    RESULTS 1 - 10 OF 4174