ECB has published a letter from its Supervisory Board Chair, Danièle Nouy, to the management of significant banks, providing public guidance on the recognition of significant credit risk transfer (SRT). The guidance sets out the procedure significant supervised entities should follow when acting as originator institutions in respect of all securitisation transactions. It covers:

  • the notification of transactions by originator institutions;
  • the information to be provided by originator institutions;
  • ECB’s assessment of recognition applications;
  • the ongoing monitoring of SRT; and
  • that informal exchanges before issuance do not represent approvals or confirmations.

(Source: ECB gives guidance on SRT recognition)