EBA consultation on STS criteria interpretation is released

Today the EBA released its consultation on the interpretations of the STS criteria (other than the homogeneity criterion which is the subject of a separate exercise).

The EBA’s guidelines and recommendations on interpreting the STS criteria which, under the STS Regulation, must be published by 18th October, 2018 are an essential part of the new STS infrastructure.  Without them it will be impossible to determine what the requirements would be for a securitisation to be STS.  Strong and sensible guidelines would provide a major boost to the likelihood of a successful STS regime and a commensurate growth in a safe European securitisation market.  At the same time, over-complex or unrealistic guidelines could dramatically reduce the chances of the STS regime delivering hoped for benefits to the European economy.

All stakeholders in the European securitisation should therefore take a keen interest in this consultative exercise.  The deadline for submissions is 20th July.  A public hearing is also scheduled for the 11th June.