Risks outweigh reward for conduit STS switch

carrot
By Tom Brown
03 Oct 2019

Several European banks sponsoring ABCP conduits have been investigating the possibility of converting these vehicles to the STS regime, but bankers say the risks outweigh the reward.

While certain individual conduit transactions have been certified as STS, no issuer has yet to fully certify an entire conduit. In total, there have been 61 official STS authorisations either by Prime Collateralised Securities (PCS) or STS Verification International (SVI). Out of these, 10 are ABCP transactions.

“The ...

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