'Ridiculous' sovereign caps pushed to top of Europe’s ABS agenda

triple-A rating sign
By Tom Porter
17 Jun 2014

After European Central Bank board member Yves Mersch shone the spotlight on sovereign rating caps in ABS last week, Delta Lloyd’s Hendrik Jan Luikinga has told GlobalCapital of his frustration with the practice, as well as other challenges the market faces in growing its investor base.

“If they took the sovereign caps away there would be much more issuance from Southern Europe,” said treasury director Jan Luikinga. “That is a very easy thing to do because the ceilings are ridiculous. If you structured a deal issued by a Greek bank, with a pool originated ...

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