Rhetoric jars as ABS loses more regs ground

Michel Barnier 230
By Tom Porter
15 May 2014

Recent pro-securitization rhetoric from European policymakers rung hollow in bankers’ ears this week as a new regulatory document revealed that, while a broader range of ABS can count towards banks' liquidity coverage ratios, RMBS will still suffer punitive treatment — even as covered bonds received a boost.

A leaked European Commission document this week showed that the EU’s regulatory arm, led by Michel Barnier, is considering allowing high quality SME, consumer and auto loan ABS to count towards banks’ LCRs as Level 2B assets, alongside RMBS.

The draft appears to do away with a loan-to-value ...

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