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There has been some interesting media coverage of Mario Draghi’s call for the reform of the EU securitisation market. In his recent report, “The Future of European Competitiveness”, Draghi sets out his vision for increasing the financing capacity of the banking sector by reviving the securitisation market and completing the Banking Union. His recommendations include:

  • That the European Commission makes a proposal to adjust prudential requirements for securitised assets
  • That the EU should review transparency and due diligence rules for securitised assets, “which are relatively high compared to other asset classes and reduce their attractiveness”
  • That ESMA should transition into the single common regulator for all EU securities markets, similar to the US SEC

According to Draghi, “Setting up a dedicated securitisation platform, as other economies have done, would help to deepen the securitisation market, especially if backed by targeted public support”.

Food for thought for market participants and policymakers alike.

View the report

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