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Tom Hall goes through a sterling week of deals for European ABS, while Thomas Hopkins dissects the dangers that a rise in LMEs would pose for European CLOs
Proposed 10% limit on interest would strip out most of securitizations' excess spread
Implementation necessary after wide-ranging changes last year
It is not enough to just undo some of the European Commission’s more controversial proposals
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Some of the more creative souls in corporate debt markets are trying to find ways to gloss over the impact of the IFRS 16 accounting standard. Brought in a year ago, it has driven up some firms’ leverage ratios by forcing them to report leases on their balance sheets, even though their businesses have not changed. But it would be a bad idea to act as if the rules had never changed.
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Regulators are helping those banks most at risk of failing to meet their minimum requirements for own funds and eligible liabilities (MREL) by giving them extra time to prepare, a report from the European Banking Authority said this week.
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The European Commission has opened a public consultation on MiFIR/MiFID II, as it takes stock of two years of the sweeping regulations.
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In this round-up, China could face a downgrade to its sovereign rating, Hong Kong’s finance secretary expects a “tsunami-like” impact on the economy from the Covid-19 outbreak, and the Chinese securities regulator relaxed rules on stock issuance.
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In this round-up, the number of novel coronavirus infections increased by 14,840 in a single day after the Hubei province changed its diagnosis methodology, China has put the former mayor of Shanghai in charge of Hubei amid the prolonged outbreak, and regulators have given the green light to MasterCard’s long-awaited entry to the Mainland market.
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Deutsche Bank’s ability to issue a new additional tier one bond illustrates the lesson of investing in European banks over recent years: bet on bonds, not equity.