MFA has submitted a comment letter in response to the European Commission’s Consultation on the Functioning of the EU Securitisation Framework, encouraging the introduction of reforms aimed at improving “the appeal and competitiveness” of the markets.
The MFA would like the EC to ‘right-size’ the definition of securitisation, remove duplicative due diligence requirements, and align the securitisation framework with other jurisdictions as part of a package of reforms it believes will improve the attractiveness of EU securitisation markets to investors, including EU and global investment managers.
“Reforming the EU securitisation framework will enhance EU capital markets and drive economic growth and competitiveness throughout the continent,” said Bryan Corbett, MFA President and CEO. “A fresh regulatory approach that recognises internationally accepted standards, promotes harmonisation and cross-border activity, and removes duplicative, burdensome regulation will contribute to the development of the European Savings and Investments Union.”
The MFA says its proposed reforms “will enhance market participation and capital flows from both domestic and international investors, fully unlock the potential of the securitisation markets, stimulate EU economic growth, and contribute to the development of the EU Savings and Investments Union. Additionally, it offers the benefits of reducing risks on banks’ balance sheets, increasing the capital available to borrowers and for investments, and diversifying alternative investment fund investment portfolios”.
