LONDON, 8 April 2015 – The European Savings and Retail Banking Group participated on 31 March in a meeting with the European Banking Authority in London.
The meeting served as a follow-up to ESBG’s response to the EBA consultation on a High-Quality Securitisations framework for simple, standardised and transparent securitisations. ESBG welcomes this initiative as a functioning securitisation market – supplementing bank loans as a main financing instrument – is essential to support economic development, and for providing sufficient credit to companies, particularly to small and medium-sized enterprises.This is especially true where banks require a complementary, functioning market that allows them to boost lending, in the event of higher credit demand by corporate borrowers, beyond their capacity of on-balance-sheet lending within the scope available under the Basel III regime.
ESBG welcomes the establishment of a uniform catalogue of criteria at a European level with the EBA and the European Commission and at an international level with the Basel Committee, however ESBG warns against including criteria based on credit risk. Indeed, ESBG believes that the creation of a separate category of securitisation is very welcome but should be focusing solely on simplicity, standardisation and transparency, and not on risk.
In particular during this meeting, ESBG representatives made a presentation on the obstacles to an efficient securitisation market with proposed solutions, and insisted on the inclusion of certain synthetic securitisations into the high-quality securitisations framework that is deemed to be of utmost importance.
Further discussions will be held with the decision-makers in the context of the EC consultation on Capital Markets Union and securitisation.