ECB’s ABS plan branded too little too late by securitization markets

By Matthew Scully
18 Jun 2014

US securitization professionals say the European Central Bank may be missing the mark by focusing too narrowly on “high quality” ABS, and are drawing parallels to the US Treasury’s debt financing that stabilized distressed assets right after the crisis. The question that market participants are now asking is whether such a programme may be too late for Europe — while debate is also raging within the ECB as to whether its proposed actions are appropriate.

The ECB may soon pursue its first programme of asset backed purchases, but only for "simple and transparent" high quality securitizations. Ganesh Rajendra, head of mortgage strategy at Royal Bank of Scotland in London, on Wednesday described the plan as a “big bang” moment for securitization in Europe, ...

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