ESMA has published its opinion on a common EU framework applying to loan origination by investment funds. It sets out ESMA’s views on elements of loan origination which a future consultation by the Commission could focus on, including:

  • general considerations on loan origination by investment funds;
  • authorisation of loan-originating funds and their managers;
  • authorisation of alternative investment fund (AIF) managers (AIFMs) managing loan-originating funds;
  • authorisation of loan-originating funds;
  • types of loan-originating AIFs;
  • types of investors;
  • organisational requirements for AIFMs managing loan-originating AIFs;
  • general requirements for loan-originating AIFs: leverage, liquidity, stress testing, reporting;
  • diversification, eligible investments and eligible debtors; and
  • systemic risk.

(Source: ESMA opines on loan origination)