30 June 2021
The European Banking Authority (EBA) launched today a public consultation on draft Regulatory Technical Standards (RTS) specifying the requirements for originators, sponsors, original lenders and servicers related to risk retention, in line with the Securitisation Regulation. The RTS aim to clarify requirements relating to risk retention, thus reducing the risk of moral hazard and aligning interests. The RTS also provide clarity on new topics, including risk retention in traditional securitisation of non-performing exposures (NPE). The consultation runs until 30 September 2021.
The RTS carry over a substantial amount of provisions from the EBA RTS on risk retention submitted to the European Commission in July 2018. The RTS also include a number of new provisions, such as specifying modalities of risk retention in traditional NPE securitisations and specifying requirements for the expertise of servicers acting as a retainers in such NPE securitisations. In addition, the RTS address some specific issues, related, for instance, to the impact of fees payable to the retainer on risk retention, risk retention in re-securitisations or in securitisations of own issued debt instruments. They also provide clarification on the treatment of synthetic excess spread.
By providing additional clarity on risk retention in case of portfolios of NPE, this publication is also part of the EBA comprehensive work on supporting the functioning of the secondary markets for NPE. For more information about the EBA work on NPE you can read here.
Comments to this consultation can be sent to the EBA by clicking on the "send your comments" button on the consultation page. Please note that the deadline for the submission of comments is 30 September 2021. All contributions received will be published following the end of the consultation, unless requested otherwise.
A public hearing will take place online on 14 September 2021 from 11:00 to 12:00 Paris time.
These draft RTS have been developed on the basis of Article 6(7) of Securitisation Regulation (Regulation (EU) 2017/2402), as amended by the Capital Market Recovery Package (Regulation (EU) 2021/557), which mandates the EBA to specify in greater detail the risk retention requirement in securitisation.
Franca Rosa Congiu