Forslag til EUROPA-PARLAMENTETS OG RÅDETS FORORDNING om ændring af Europa-Parlamentets og Rådets forordning (EU) 2017/2402 af 12. december 2017 om en generel ramme for securitisering og om oprettelse af en europæisk ramme for simpel, transparent og standardiseret securitisering

EN EN
EUROPEAN
COMMISSION
Strasbourg, 17.6.2025
COM(2025) 826 final
2025/0826 (COD)
Proposal for a
REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
amending Regulation (EU) 2017/2402 of the European Parliament and of the Council of
12 December 2017 laying down a general framework for securitisation and creating a
specific framework for simple, transparent and standardised securitisation
(Text with EEA relevance)
{SEC(2025) 825 final} - {SWD(2025) 826 final} - {SWD(2026) 825 final}
Offentligt
KOM (2025) 0826 - Forslag til forordning
Europaudvalget 2025
EN 1 EN
EXPLANATORY MEMORANDUM
1. CONTEXT OF THE PROPOSAL
• Reasons for and objectives of the proposal
Relaunching the European securitisation market can help increasing the amount of financing
available to the real economy. That is more important than ever in the current economic and
geopolitical environment where the Union faces significant investment needs to remain
resilient and competitive. Well-functioning securitisation markets can contribute to higher
economic growth and facilitate funding of Union strategic objectives, including investments
in the green, digital and social transition, by allowing banks to transfer risks to those that are
best suited to bear them and thereby free up their capital. Banks are expected to use this
capital for additional lending to households and businesses, including small and medium-
sized enterprises (SMEs). By redistributing risk within the wider financial system,
securitisation can also provide capital market investors with more investment opportunities.
The current EU securitisation framework is keeping the EU economy from reaping many of
the benefits that securitisation can offer.
The reports from Enrico Letta1
and Mario Draghi2
have recommended securitisation as a
means of strengthening the lending capacity of European Union’s banks for the financing
needs of EU priorities including defence, creating deeper capital markets, building the
Savings and Investments Union and increasing the EU’s competitiveness.
The European Council has asked the European Commission to identify measures to relaunch
the European securitisation market, including “through regulatory and prudential changes,
using available room for manoeuvre”3
and to swiftly propose, in 2025, a revised securitisation
framework4
. There is also a call for action by many stakeholders, including issuers, investors
and supervisors, to address barriers that are hindering the development of the EU
securitisation market5
.
The EU securitisation framework was put in place in the aftermath of the 2008 financial crisis
and responded to concerns about risky US securitisations. At the time, strict requirements
were considered necessary to restore the reputation of the securitisation market which had
been suffering from inadequate protections and severe investor distrust. Now that appropriate
safeguards have been firmly embedded in the market’s organisation and securitisation is
gaining back investors’ trust, a better balance between safeguards and growth opportunities -
both for investments and issuance- needs to be found. The experience with the framework
indicates that it is too conservative and limits the potential use of securitisations in the EU.
High operational costs and overly conservative capital requirements keep many issuers and
investors out of the securitisation market.
The review aims to recognise the risk mitigants implemented in the EU securitisation
regulatory and supervisory frameworks, which have significantly reduced the risks embedded
in securitisation transactions, as well as the good credit performance of EU securitisations.
1
Letta, E. (2024). Much more than a market - Speed, Security, Solidarity. Empowering the Single
Market to deliver a sustainable future and prosperity for all EU Citizens.
2
Draghi, M. (2024). The Future of European Competitiveness—A Competitiveness Strategy for Europe.
3
European Council conclusions of April 2024.
4
European Council conclusions of March 2025.
5
Feedback on call for evidence on review of the Securitisation Framework, 19 February 2025 – 26
March 2025, europa.eu; feedback on 2024 targeted consultation on the functioning of the EU
securitisation framework, 9 October – 4 December 2024, finance.ec.europa.eu.
EN 2 EN
This proposal contributes to the 2024-2029 Commission’s priority of ‘A new plan for
Europe’s sustainable prosperity and competitiveness’. The proposal is a component of the
Savings and Investments Union6
, which is a cornerstone of the 2024-2029 Commission
mandate, and it is the first legislative initiative under the Savings and Investments Union. At
the same time, it is important to recognise that the Securitisation Review is not a ‘silver
bullet’ on its own. The SIU project encompasses a broad range of other and complementary
measures to achieve its goals. Nevertheless, the European Commission expects that the
amendments to the non-prudential and prudential requirements envisaged in this package of
proposals will lead financial institutions to engage in more securitisation activity and,
importantly, to use the resultant capital relief for additional lending.
The proposed review of the EU securitisation framework aims to remove undue issuance and
investment barriers in the EU securitisation market, specifically:
• To reduce undue operational costs for issuers and investors, balancing with adequate
standards of transparency, investor protection and supervision.
• To adjust the prudential framework for banks and insurers, to better account for
actual risks and remove undue prudential costs when issuing and investing in
securitisations, while at the same time safeguarding financial stability.
The main financial stability safeguards in the framework (risk retention, ban on re-
securitisation, robust credit granting standards) will not be affected by this reform. Moreover,
the proposed changes are accompanied by changes to the supervisory framework that improve
supervisory convergence and ensure that the supervisory framework is fit for a growing EU
securitisation market.
The review of the EU securitisation framework aims to remove undue obstacles that hinder
the growth and development of the EU securitisation market, but without introducing risks to
financial stability, market integrity or investor protection. To achieve this, the proposed
reforms are carefully targeted to address specific impediments to issuance and (non-bank)
investment. The review envisages changes to four legal acts:
• a legislative proposal amending the Regulation (EU) 2017/2402 of the European
Parliament and of the Council (the ‘Securitisation Regulation’7
), which sets out
product rules and conduct rules for issuers and investors
• a proposal amending Regulation (EU) No 575/2013 of the European Parliament and
of the Council (the ‘Capital Requirements Regulation’ or ‘CRR’8
), which sets out the
capital requirements for banks holding and investing into securitisation, as well as
• amendments to two delegated Regulations: the Commission Delegated Regulation
(EU) 2015/61 (the ‘Liquidity Coverage Ratio (LCR) Delegated Act’9
), governing the
6
https://finance.ec.europa.eu/document/download/13085856-09c8-4040-918e-
890a1ed7dbf2_en?filename=250319-communication-savings-investmlents-union_en.pdf
7
Regulation (EU) 2017/2402 of the European Parliament and of the Council of 12 December 2017 laying
down a general framework for securitisation and creating a specific framework for simple, transparent
and standardised securitisation, and amending Directives 2009/65/EC, 2009/138/EC and 2011/61/EU
and Regulations (EC) No 1060/2009 and (EU) No 648/2012, OJ L 347, 28.12.2017, p. 35,
ELI: http://data.europa.eu/eli/reg/2017/2402/oj).
8
Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on
prudential requirements for credit institutions and investment firms and amending Regulation (EU)
No 648/2012, OJ L 176, 27.6.2013, p. 1, ELI: http://data.europa.eu/eli/reg/2013/575/oj).
EN 3 EN
eligibility criteria for assets to be included in banks’ liquidity buffer, and the
Commission Delegated Regulation (EU) 2015/35 (the ‘Solvency II (SII) Delegated
Act’10
), governing the capital requirements for insurance and reinsurance
undertakings.
The envisaged changes aim to make targeted improvements to the framework, rather than
overhaul it. Those changes should be viewed as a package, as none of the individual
components will achieve the desired outcome on its own. The elements of the package
address both the supply and demand side of the market and reinforce each other to produce
the desired impact. Streamlining reporting requirements and lowering capital requirements
will both lower entry barriers and make it cheaper for banks to originate securitisations.
Simplifying due diligence and amending the capital charges and liquidity treatment will make
it easier and more attractive to invest in securitisation. A larger and more dynamic investor
base will also incentivise more issuance. Relaunching the EU securitisation market is a
complex issue that requires changes to be made in various parts of the framework to foster
supply and demand in the securitisation market.
Regulation alone can only go so far in terms of stimulating this market’s development: market
participants must also step in and do their part, e.g. by embracing standardisation and
industry-wide initiatives towards specific segments – without market participant efforts,
scaling up of the market will not be possible.
Various inputs have informed this review, including the 2020 EBA report on the significant
risk transfer, the 2020 ESRB report on Monitoring systemic risks in the EU securitisation
market, the 2022 Commission Report on the Securitisation Regulation, the 2022 Joint
Committee of the ESAs advice on the prudential framework, the 2024 targeted consultation
on the functioning of the EU securitisation framework, and the 2025 Joint Committee Report
on the implementation and functioning of the securitisation framework. The Commission also
held various bilateral meetings with stakeholders and organised a workshop in July 2024 to
discuss stakeholder views about the EU securitisation framework.
In terms of timing, the amendments to the Securitisation Regulation and the Capital
Requirements Regulation are adopted by the Commission together. On the same date, the
draft amendments to the Liquidity Coverage Ratio Delegated Regulation should be published
on Have Your Say for a four-week consultation. The Commission plans to adopt draft
amendments to the Solvency II Delegated Regulation in a broader package of amendments to
that Regulation that is expected to be published for consultation in the second half of July of
this year.
• Consistency with existing policy provisions in the policy area
The revision to the non-prudential provisions of the EU securitisation framework under the
Securitisation Regulation are part of a broader legislative package that includes amendments
9
Commission Delegated Regulation (EU) 2015/61 of 10 October 2014 to supplement Regulation (EU)
No 575/2013 of the European Parliament and the Council with regard to liquidity coverage requirement
for Credit Institutions OJ L 11, 17.1.2015, p. 1, ELI: http://data.europa.eu/eli/reg_del/2015/61/oj).))
10
Commission Delegated Regulation (EU) 2015/35 of 10 October 2014 supplementing Directive
2009/138/EC of the European Parliament and of the Council on the taking-up and pursuit of the
business of Insurance and Reinsurance (Solvency II) (OJ L 12, 17/01/2015, p. 1,
ELI: http://data.europa.eu/eli/reg_del/2015/35/oj)
EN 4 EN
to the Capital Requirements Regulation, the Liquidity Coverage Ratio Delegated Act and the
Solvency II Delegated Act. The proposed changes have been drafted to ensure consistency
across the various pieces of legislation and with the same general objective in mind.
The current proposal aligns the provisions on the delegation of due diligence tasks with those
contained in Directive 2011/61/EU of the European Parliament and of the Council (the
‘AIFMD’)11
.
In addition to the legislative changes included in this package, the Commission is also
considering amending the issuer limit in the Undertakings for Collective Investment in
Directive 2009/65/EC of the European Parliament and of the Council (the ‘UCITS
Directive’)12
in the context of the upcoming overall review of the UCITS Directive. The
UCITS Directive imposes a limit on UCITS funds not to acquire more than 10% of the debt
securities of a single issuing body. In case of securitisation that means that UCITS funds are
only allowed to invest up to 10% in a single securitisation issuance since the securitisation
vehicle itself is considered the issuer.
• Consistency with other Union policies
By making the EU securitisation framework less burdensome and, more principles-based, the
current proposal also contributes to the current Commission-wide effort to cut red tape and
simplify the business environment as announced in the Commission 2025 work programme.
The review of the securitisation framework is also in line with the European Commission’s
broader strategy to rejuvenate the EU's economy, as outlined in the Competitiveness
Compass. By removing undue issuance and investment barriers in the EU securitisation
market, the Commission aims to ensure that the EU economy can benefit from increased risk
sharing opportunities and financing, thereby supporting economic growth and the EU’s
competitiveness.
Part of the identified issuance and investment barriers stems from high operational costs
linked to the regulation. Removing these costs is therefore also in line with the Commission’s
communication on a "Simpler and Faster Europe", which emphasizes reducing the regulatory
burden on both households and businesses.
Finally, the proposal is consistent with the Union's objective of safeguarding financial
stability by ensuring that securitisation markets operate in a transparent, prudent, and resilient
manner.
2. LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY
• Legal basis
The legal basis of the Regulation (EU) 2017/2402is Article 114 of the Treaty on the
Functioning of the European Union (the ‘TFEU’) which confers to the institutions of the
European Union the competence to lay down appropriate provisions that have as their
objective the establishment and functioning of the single market. The proposal introduces
11
Directive 2011/61/EU of the European Parliament and of the Council of 8 June 2011 on Alternative
Investment Fund Managers and amending Directives 2003/41/EC and 2009/65/EC and Regulations
(EC) No 1060/2009 and (EU) No 1095/2010, OJ L 174, 1.7.2011, p. 1,
ELI: http://data.europa.eu/eli/dir/2011/61/oj).
12
Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 on the
coordination of laws, regulations and administrative provisions relating to undertakings for collective
investment in transferable securities (UCITS) (recast), OJ L 302, 17.11.2009, p. 32,
ELI: http://data.europa.eu/eli/dir/2009/65/oj).
EN 5 EN
targeted amendments to Regulation (EU) 2017/2402and is therefore based on the same legal
basis.
In particular, Article 114 TFEU confers the European Parliament and the Council with the
competence to adopt measures for the approximation of the provisions laid down by law,
regulation or administrative action in Member States which have, as their object, the
establishment and functioning of the internal market. Article 114 TFEU allows the Union to
take measures not only to eliminate current obstacles to the exercise of the fundamental
freedoms, but also to prevent, if they are sufficiently concretely foreseeable, the emergence of
such obstacles, including those that make it difficult for economic operators, including
investors, to take full advantage of the benefits of the internal market.
• Subsidiarity (for non-exclusive competence)
Securitisation products are an important segment of Union financial markets, contributing to
Union financial integration. Securitisation links financial institutions from different sectors of
the financial markets and from different Member States and non-EU jurisdictions and can
raise financial stability issues when not properly regulated. Therefore, securitisation requires
regulation at Union level.
The purpose of the proposal is to make the EU securitisation framework less burdensome, and
more principles-based. Achieving that objective will mean that financial institutions across
the Union are better able to use securitisation as a tool to deepen EU capital markets, to
diversify their risk profile and to free up banks’ balance sheets for additional lending to EU
households and businesses. Action at EU level also ensures a high level of financial stability
across the EU. Overall, that aims to contribute to a more competitive and resilient EU
economy.
In particular, the proposal examines certain provisions on due diligence, transparency and
supervision13
. Only action at EU level can ensure that going forward, those regulatory
provisions are applied uniformly and guarantee the existence of the well-established
regulatory framework regarding the taking up and the pursuit of securitisation and business
across the Single Market. That is especially important as the majority of EU securitisation
activity is concentrated in a handful of EU Member States. A Union-wide regulatory
framework is fundamental to facilitating cross-border securitisations, and particularly to
enable such activity in Member States where there is currently low uptake of securitisations
overall. The ability of Member States to adopt national measures is limited, given that the
existing EU securitisation framework already provides for a harmonised set of rules at EU
level and that changes at national level would conflict with Union law currently in force.
• Proportionality
The policy choices within the proposal are considered proportionate as they target key areas
such as streamlining transparency and due diligence rules without compromising financial
stability or market integrity. The measures are calibrated to make the framework more
proportionate than it currently is, and to set out a targeted and balanced approach foster
13
The targeted changes to supervision aim to enhance the effective functioning of supervision under the
existing framework. Those adjustments aim to support more consistent supervisory practices and
facilitate cross-border securitisation activity within the Union. By clarifying certain aspects and
ensuring clearer delineation of responsibilities, the proposed amendments are expected to foster greater
supervisory convergence without imposing significant new obligations on stakeholders
EN 6 EN
issuance, investment, and market confidence. The proposal’s proportionality is further
substantiated by the Impact Assessment, which assesses the potential costs and benefits,
ensuring the chosen measures are necessary and effective in meeting the overarching goals of
the reform.
At the same time, the policy choices do not go beyond what is necessary to achieve the stated
objectives and refrain from a complete overhaul of the regulatory framework.
• Choice of the instrument
The proposal is an amendment to Regulation (EU) 2017/2402 and, therefore, it is a proposal
for a Regulation. No alternative means – legislative or operational – can be used to attain the
objectives of this proposal.
3. RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER
CONSULTATIONS AND IMPACT ASSESSMENTS
• Ex-post evaluations/fitness checks of existing legislation
An evaluation of the securitisation framework was conducted covering the period from the
date of into application of the securitisation framework (1 January 2019) until present. Its
scope includes the legal framework in its entirety (Securitisation Regulation, relevant parts to
the CRR, LCR Delegated Act and SII Delegated Act that pertain to securitisation
transactions).
In line with the Better Regulation Toolbox, it examines whether the objectives of the
securitisation framework were met during the period of its application (effectiveness) and
continue to be appropriate (relevance) and whether the framework, taking account of the costs
and benefits associated with applying it, was efficient in achieving its objectives (efficiency).
The evaluation also considers whether the securitisation framework, as legislation at Union
level, provided added value (EU added value) and whether it is consistent with other related
pieces of legislation (coherence). The evaluation was conducted in parallel with the impact
assessment accompanying the proposal revising the securitisation framework.
The evaluation concluded that the securitisation framework was partially successful in
meeting its original objectives. It has supported the standardisation of processes and practices
and partly tackled regulatory uncertainty. However, it has only been partly successful in
removing the stigma associated with securitisation, and in removing regulatory disadvantages
for simple and transparent securitisations, despite the regulatory improvements put in place.
Moreover, the Framework has not been successful in reducing high operational costs and in
significantly scaling up the securitisation market in the EU.
As a result, the evaluation concluded that more is needed to ensure that securitisation can
meaningfully contribute to improve the financing of the EU economy and further develop the
Savings and Investments Union. More specifically, the evaluation assessed that very
prescriptive legal requirements in the area of transparency and due diligence result in high
operational costs for issuers and investors in securitisations, and that a more principles-based
approach might be more suitable. The prudential framework for banks and insurers is
insufficiently risk sensitive and capital ‘non-neutrality’ is disproportionately high for certain
EN 7 EN
securitisation transactions. Therefore, to address undue prudential barriers, a revision of the
prudential treatment of securitisations is necessary.
• Stakeholder consultations
On 3 July 2024, the Commission hosted a Securitisation Workshop, which invited
representatives from the banking industry/associations, Ministries, European Supervisory
Authorities (ESAs), the Single Supervisory Mechanism of the European Central Bank, the
European Investment Bank, insurers, asset managers, nongovernmental organisations and
pension funds to share their views.
A targeted public consultation on the functioning of the EU securitisation framework was
carried out between 9 October 2024 to 4 December 2024. 133 responses were received from a
variety of stakeholders14
. The consultation was split into twelve sections which sought to
gather views from a broad range of stakeholders active in the EU securitisation market on
whether the securitisation framework met and continues to meet its objectives in terms of
market safety, operational cost reduction and prudential risk-sensitivity. The consultation was
also used to collect feedback on the operation of the STS standard, the effectiveness of
supervision, and the prospect of a future securitisation platform(s). In addition, the
Commission has carried a series of bilateral meetings with a wide range of stakeholders who
confirmed the feedback already received.
The feedback gathered in that consultation is reflected in the evaluation of the securitisation
framework.
A call for evidence was opened between 19 February 2025 and 26 March 202515
to request
feedback from stakeholders on the review of the securitisation framework. Stakeholders were
asked to provide views on the Commission's understanding of the problem and possible
solutions, and to provide relevant information. 34 respondents replied to the call for evidence
and presented their views16
. Out of those 34 respondents, 2617
had also replied to the 2024
targeted consultation, with their views remaining broadly the same. Points made by first-time
respondents were also consistent with the feedback of the targeted consultation previously
received.
• Collection and use of expertise
The preparation of this proposal has benefited from extensive expert input, including
stakeholder consultations, meetings, and analytical work carried out by the ESAs. In
particular, the ESAs delivered the 2021 and 2025 Art. 44 Joint Committee reports on the
14
Available at https://finance.ec.europa.eu/regulation-and-supervision/consultations-0/targeted-
consultation-functioning-eu-securitisation-framework-2024_en
15
Securities and markets - review of the Securitisation Framework (europa.eu)
16
One respondent made two separate (substantively similar) contributions; another respondent submitted
three separate contributions. Therefore, 37 contributions were received, from 34 individual respondents.
17
The respondents that had already replied to the targeted consultation represented: 7
companies/businesses, 15 business associations, 2 non-governmental organisations (NGOs), 2 such
respondents identified as “other
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implementation and functioning of the Securitisation Regulation18
. Those reports focused on
the implementation of the general requirements applicable to securitisations, including the
risk retention, due-diligence and transparency requirements, and specific requirements related
to STS securitisation, with respect to the Frameworks original objective of contributing to the
sound revival of the EU securitisation framework.
National authorities were consulted in the framework of the Eurogroup Working Group+ , the
Council Financial Services Committee , and the Commission Expert Group on Banking,
Payments and Insurance. Several Member States also replied to the Targeted Consultation
through their finance ministries and engaged with the Commission bilaterally.
• Impact assessment
For the preparation of this review an Impact Assessment was prepared and discussed with an
Interservice Steering Group. The Impact Assessment report was submitted to the Regulatory
Scrutiny Board on 12 March 2025. The board meeting took place on 9 April 2025. The Board
gave a positive opinion and called for changes and additional input in the following areas:
problem definition and substantiation; further detail on the assessed options and associated
trade-offs; additional assessment on the combined impacts of options, particularly in relation
to their relative risk levels and impact on financial stability. Those issues have been addressed
and incorporated in the final version which is available on the Commission website and
published together with this proposal.
Policy options for the entire package were identified in three key areas. Options to (i) reduce
high operational costs, (ii) reduce undue prudential barriers for banks to issue and invest in
securitisation, and (iii) remove undue prudential costs for insurers to invest in the EU
securitisation market, were considered. That assessment resulted in a “bundle” of preferred
options which, taken together, were deemed to best achieve the stated objectives.
To reduce high operational costs (estimated at 780 million per year for the market as a whole),
both a targeted and broader set of measures were considered. Those options involve, to
varying degrees, simplifying and removing certain due diligence and transparency
requirements that are deemed duplicative or overly prescriptive (e.g., removing verification
requirements for EU transactions and streamlining reporting templates). Our preferred option
results in cost savings of 310 million per year. Similarly, targeted and more radical changes to
the existing prudential framework for banks were assessed. Those focused on adjustments to
the CRR and LCR, seeking to ensure greater risk-sensitivity for the capital treatment of
securitisation for banks, to broaden the eligibility of securitisations for banks’ liquidity
buffers, and to make supervisors’ assessment of transactions’ eligibility for capital relief
under the Significant Risk Transfer Framework faster and more coherent. A fundamental
revision of the prudential framework for banks was another option considered. To remove
disincentives for insurers to invest in the EU securitisation market, three options were
assessed, entailing different degrees and modalities of reductions in the capital requirements
for insurers investing in securitisations.
Based on the comparative assessment in terms of effectiveness, efficiency, and coherence, a
preferred bundle of non-prudential and prudential measures was selected which were deemed
the best avenue for the EU to take to reduce burden and compliance costs for issuers and
18
https://www.eiopa.europa.eu/system/files/2021-05/jc-2021-31-jc-report-on-the-implementation-and-
functioning-of-the-securitisation-regulation.pdf
EN 9 EN
investors, to revitalise the securitisation market and enhance the competitiveness of the EU
financial system. Financial institutions across the EU will face a simpler and less costly
transparency and due diligence regime and greater risk-sensitivity with regards to the actual
risk of the securitisation investment.
The impact assessment of the various policy options primarily focused on their economic and
regulatory impacts. The options can be considered to have only indirect impacts on social,
environmental, and fundamental rights issues. Indirectly, the proposal would improve access
to credit and financial services, particularly for corporates and SMEs, thereby promoting
social inclusion, job creation, and economic growth. Though not the primary focus, the
proposal may indirectly support environmental sustainability by facilitating green investments
through improved capital access and alignment with existing green securitisation frameworks.
There are no direct effects on fundamental rights, but the initiative supports financial stability
and complies with data protection laws, thereby indirectly reinforcing economic rights and
privacy safeguards.
• Regulatory fitness and simplification
The proposal simplifies and refines the existing legal provisions applying to securitisations, to
enhance efficiency within the securitisation market. Therefore, it is of relevance to the
Regulatory Fitness Programme (REFIT). The preferred option concerning the Securitisation
Regulation entails a simplification of due diligence duties for businesses and a more efficient
transparency framework. By reducing those obligations, businesses will face lower
compliance costs, enabling more resources to be allocated to core business activities. While
issuers may encounter some one-off adaptation costs, the recurrent reduction in administrative
burdens should outweigh those initial expenditures. Through targeted adjustments and
strategic simplification, those measures are positioned to bolster the market's capacity, attract
a broader base of investors, and encourage economic growth—while maintaining a resilient
and transparent financial ecosystem.
The policy options taken in this proposal should have several positive effects on SME
financing and competitiveness (see Annexes VII and VIII of the Impact Assessment report).
• Fundamental rights
The proposal is not likely to have a direct impact on the rights provided in the Charter of
Fundamental Rights of the European Union. The simplification and efficiency measures do
not directly address issues relating to personal data or privacy. Nonetheless, changes to
disclosure and reporting standards must comply with existing data protection laws to ensure
the security and privacy of any personal data involved in the securitisation process.
The proposal aims to reduce high operational costs and remove undue prudential barriers,
while avoiding undue deterioration of protection and avoiding incentives for excessive risk-
taking. It therefore represents a balancing of the need for economic stimulus with maintaining
robust standards, thus minimising negative societal impacts. Overall, while the proposed
measures mainly focus on financial regulation, there are potential indirect benefits that can
arise, impacting social, environmental, and fundamental rights in supportive and sustainable
ways. Ensuring a stable securitisation market contributes indirectly to the protection of
fundamental economic rights by promoting financial stability through risk diversification.
EN 10 EN
4. BUDGETARY IMPLICATIONS
This legislative proposal would have limited consequences for the Union budget. It will imply
further policy development within the Commission and in the three ESAs. Specific
coordination tasks will be assigned to the European Banking Authority (EBA) in the context
of the securitisation sub-committee reporting to the Joint Committee of the ESAs. The EBA’s
role will include providing the secretariat, permanent vice-chairpersonship to securitisation
committee of the Joint Committee of the European Supervisory Authorities referred to in Art.
36(3) (securitisation sub-committee) and leading the work of this sub-committee focusing,
amongst other things, on supervisory issues, providing guidance to market participants,
developing technical standards, and ensuring a consistent implementation of the regulatory
framework in the Union. A financial fiche is provided as an annex hereto.
5. OTHER ELEMENTS
• Implementation plans and monitoring, evaluation and reporting arrangements
Since the instrument proposed is a Regulation that is based to a significant extent on existing
Union law, there is no need to prepare an implementation plan. The proposal is accompanied
by a complete evaluation, as part of the impact assessment, which assesses, among other
things, how effective and efficient it has been in terms of achieving its objectives. The
proposal provides for a review report in Article 46 of Regulation (EU) 2017/2402. The review
will be accompanied by a legislative proposal, if appropriate. In that context, the reviewing
and reporting requirements would be aligned, if needed.
The Commission shall carry out an evaluation of this package of proposed amendments, five
years after its date of application and present a report on the main findings to the European
Parliament, the Council and the European Economic and Social Committee.
• Detailed explanation of the specific provisions of the proposal
Interaction and consistency between elements of the package
This proposal for a Regulation makes part of a wider securitisation review which
encompasses changes to two Regulations (in addition to the Securitisation Regulation, the
CRR) and two Delegated Acts (the LCR Delegated Act and the Solvency II Delegated Act).
The proposed changes should be viewed as a package of measures that tackles in a
comprehensive manner supply and demand issues in the securitisation market.
Subject-matter and scope (Article 1)
The proposal clarifies that the servicer is an entity that manages a pool of purchased
receivables or the underlying credit exposures on a day-to-day basis falls under the scope of
Regulation (EU) 2017/2402 (the ‘Securitisation Regulation’). The amendment is a
clarification and it is not meant to enlarge the scope since a servicer is already subject to the
Securitisation Regulation.
Definitions (Article 2)
Public and private securitisations are defined Article 2, points (32) and (33). Specifically, a
“public securitisation” is established to be one if it meets any of the following conditions:
(i) a prospectus has to be drawn up;
EN 11 EN
(ii) notes constituting securitisation positions are admitted to trading in specific trading
venues, ;
(iii) the securitisation is marketed generally to investors and the specific terms are not
negotiable among the parties, meaning that the transactions is offered to investors on take-it-
or-leave-it basis.
A private securitisation is one that does not meet any of the aforementioned criteria – it does
not have a prospectus, it is not admitted to trading, and the terms and conditions are bilaterally
negotiated between the originator and a small group of investors. Clarifying the definition of
public and private securitisations is particularly relevant for the application of transparency
requirements.
Due diligence (Article 5)
To facilitate simpler and more streamlined investment in Union securitisations, some
amendments are made to Article 5 of Regulation (EU) 2017/2402. Verification requirements
(Article 5(1) and Article 5(3), point (c)) are removed for investors whenever the sell-side
party responsible for complying with the relevant sell-side provisions is established and
supervised in the Union. In addition, the risk assessment in Article 5(3), point (a) and 5(3),
point (b) of Regulation (EU) 2017/2402 is made more principled based by removing the
detailed list of structural features that investors need to check and by clarifying in a recital
that the due diligence assessment should be proportionate to the risk of the securitisation. The
written procedures under Article 5(4) of Regulation (EU) 2017/2402 are also made more
principled based by removing the detailed list of information in the second subparagraph of
Article 5(4), point (a), of Regulation (EU) 2017/2402. Secondary market transactions are
given an extra 15 days to document their due diligence. Finally, delegation of due diligence
under Article 5(5) of Regulation (EU) 2017/2402 is aligned with other sectoral legislations
where delegation of tasks does not transfer the legal responsibility.
Due diligence requirements are waived where multilateral development banks fully guarantee
the securitisation position, making it very low-risk. This means that investors can invest in
such positions without doing extensive checks.
Lighter due diligence, specifically via waiving the verification and documentation
requirements, is provided in case the securitisation includes a first loss tranche that is
guaranteed or held by a narrowly defined list of public entities and where that tranche
represents at least 15% of the nominal value of the securitised exposures.
For investments in positions issued by non-EU issuers, investors will continue to be required
to verify that a given transaction complies with EU rules.
Risk Retention (Article 6)
Risk retention is waived in case the securitisation includes a first loss tranche that is
guaranteed or held by a narrowly defined list of public entities and where that tranche
represents at least 15% of the nominal value of the securitised exposures.
Transparency (Article 7)
To lower the reporting burden on issuers, the reporting templates in Commission Delegated
Regulation (EU) 2020/1224 and Commission Implementing Regulation (EU) 2020/1225
should be reviewed. In particular, the number of required fields should be significantly
reduced – by at least 35%, or more where feasible. To further reduce the compliance burden
EN 12 EN
on the reporting entities, the review should consider distinguishing between mandatory and
voluntary fields. In addition, the reporting templates should not require loan level information
when the underlying exposures are highly-granular and short-term (such as credit card
exposures or certain consumer loans). The review of the reporting templates, taking into
account the aforementioned principles set in this proposal, should be carried out by the
securitisation sub-committee of the ESAs Joint Committee, under the leadership of the EBA,
in cooperation with the other ESAs.
The reporting template for private securitisations should be much lighter than the one for
public securitisations and focused only on the needs of supervisors. To minimise the
implementation costs for industry, this template should follow closely existing notification
templates, in particular the guide on the notification of securitisation transactions by the
Single Supervisory Mechanism. To ensure greater market transparency and facilitate the
supervision and monitoring of the private market, this dedicated template for private
securitisations should be reported to the securitisation repositories.
Securitisation Repository (Articles 10 and 17)
Amendments to Article 10 of Regulation (EU) 2017/2402 rectify a wrong reference to Article
5 of that Regulation, which should be replaced with a reference to Article 7. Proposed
amendments to Article 17 of Regulation (EU) 2017/2402 are introduced in light of the
amendments in Article 7 that will extend the report to repository also for private
securitisation. In light of those changes, a differentiation in the immediate and free of charge
access to the repository has been proposed. Such access should be granted to the ESAs, the
European Systemic Risk Board, the competent and resolution authorities and, upon request,
the European Commission. In light of the different nature of public securitisation, access is
granted also to investors and potential investors in such securitisations. Restricting the access
of investors and potential investors to private securitisations is meant to protect the
confidentiality of information in those securitisations.
STS requirements (Articles 20, 26b, 26c, 26e)
To facilitate the securitisation of SME loans in STS securitisation, the homogeneity
requirement in Articles 20(8), (15) and Article 26b(8) of Regulation (EU) 2017/2402, is to be
amended to stipulate that a securitisation where at least 70% of the underlying pool of
exposures consist of SME loans are deemed to comply with that requirement. The 70%
threshold is lower than the current 100% requirement.
To enable insurance and reinsurance undertakings to participate meaningfully in the STS on-
balance-sheet market, the eligibility criteria for credit protections in Article 26e(8) of
Regulation (EU) 2017/2402 are amended to include also an unfunded guarantee by an
insurance or reinsurance undertaking that meets certain robustness, solvency and
diversification criteria.
A number of other technical, but not substantive, amendments facilitate the implementation of
the STS criteria.
Third Party Verifiers (Article 28)
The proposal stipulates that Third Party Verifiers of STS compliance need to be supervised in
addition to authorised by their respective national competent authority.
EN 13 EN
Supervision (Articles 29, 30, 32 and 36)
To promote supervisory convergence and prevent fragmentation and differential regulatory
interpretations, the proposal strengthens the role of of the securitisation sub-committee of the
ESAs Joint Committee. In particular, the securitisation sub-committee is mandated to adopt
guidelines to establish common supervisory procedures and to develop the reporting templates
referred to in Article 7. To ensure greater accountability and continuity, the EBA is put in the
lead of the work of the securitisation sub-committee of the ESAs Joint Committee, will
provide the secretariat and a vice-chairperson for it, supporting the chairperson in the exercise
of his or her tasks and performing the tasks of the chairperson during the latter’s absence, on a
permanent basis.
To ensure efficient and consistent supervision of the STS criteria, Article 29 of Regulation
(EU) 2017/2402 should entrust banking national competent authorities with the responsibility
to supervise the application of the STS criteria by bank-originated securitisations. For credit
institutions in the Banking Union, that supervision would be carried out by the Single
Supervisory Mechanism.
To enable supervisors to enforce the due diligence requirements, Article 32 of Regulation
(EU) 2017/2402 is amended to explicitly include in the list of situations where NCAs may
apply administrative sanctions the failure of institutional investors to meet due diligence
requirements in Article 5 of Regulation (EU) 2017/2402.
Reports and Review (Articles 44 and 46)
The rolling mandate in Article 44 of Regulation (EU) 2017/2402 for the ESAs to report on the
implementation of this Regulation is updated to require also an assessment of the contribution
of securitisation to funding EU companies and economy.
The Commission is mandated to review the functioning of this amending Regulation by five
years after its date ofapplication. If found appropriate, the review will be accompanied by a
legislative proposal.
EN 1 EN
2025/0826 (COD)
Proposal for a
REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
amending Regulation (EU) 2017/2402 of the European Parliament and of the Council of
12 December 2017 laying down a general framework for securitisation and creating a
specific framework for simple, transparent and standardised securitisation
(Text with EEA relevance)
THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty on the Functioning of the European Union, and in particular
Article 114 thereof,
Having regard to the proposal from the European Commission,
After transmission of the draft legislative act to the national parliaments,
Having regard to the opinion of the European Central Bank,
Having regard to the opinion of the European Economic and Social Committee,
Acting in accordance with the ordinary legislative procedure,
Whereas:
(1) Securitisation can boost investment by allowing banks to transfer risks to those that
are able to bear them and thereby free up their capital, which they could use for
additional lending to households and businesses, including small and medium-sized
enterprises (SMEs). Regulation (EU) 2017/2402 of the European Parliament and of the
Council19
, covering both simple, transparent and standardised (STS) and non-STS
securitisations, has strengthened market transparency, safety, and standardisation. At
the same time, that Regulation should be further simplified to more fully exploit the
benefits that securitisations can offer.
(2) It is important that financial institutions employ their capital where it is most needed to
reach the Union’s economic goals and funding the real economy. In addition to the
flexibility provided for by the existing rules, targeted changes to Regulation (EU)
2017/2402 would ensure that the Union securitisation framework better supports
investments in the economy and facilitates lending to businesses.
(3) To enhance transparency and to ensure consistent regulatory treatment aiming at
reducing costs for issuers, a definition of public and of private securitisation should be
introduced. The scope of public securitisations should cover transactions where the
underlying notes are admitted to trading on regulated markets, Multilateral Trading
19
Regulation (EU) 2017/2402 of the European Parliament and of the Council of 12 December 2017 laying
down a general framework for securitisation and creating a specific framework for simple, transparent
and standardised securitisation, and amending Directives 2009/65/EC, 2009/138/EC and 2011/61/EU and
Regulations (EC) No 1060/2009 and (EU) No 648/2012 (OJ L 347, 28.12.2017, p. 35, ELI:
http://data.europa.eu/eli/reg/2017/2402/oj).
EN 2 EN
Facilities (MTFs), Organised Trading Facilities (OTFs), or any other trading venue in
the Union, and transactions marketed to investors under non-changeable terms and
conditions where the package is offered on a ”take-it-or-leave-it” basis and investors
have no direct contact with the originators or sponsor and can therefore not directly
receive necessary information to conduct due diligence without the originator or
sponsor disclosing any commercially sensitive information to the market. Defining
those types of transactions as public, by virtue of their accessibility to a broad range of
investors, should ensure that such transactions are subject to the appropriate
transparency requirements and regulatory scrutiny and contribute to better market
oversight and functioning.
(4) Due diligence requirements should be proportionate to the risk profile of securitisation
positions. Investor due diligence should therefore be focused on the risks
characteristics and structural features that can materially affect the performance of the
securitisation, avoiding duplicative, overly burdensome or generic obligations that
may not be meaningful across different types of securitisation. For the same reason,
due diligence obligations should be streamlined, thus reducing unnecessary costs for
investors — particularly in lower-risk securitisations — and fostering more
proportionate and risk-sensitive investor behaviour in the securitisation market.
(5) Originators, original lenders, sponsors or securitisation special purpose entities
(SSPEs) (the ‘sell-side entities’) that are established in the Union are already subject to
supervision in the Union and can be sanctioned in case they breach their obligations
under Regulation (EU) 2017/2402. It is therefore appropriate that investors are no
longer required to verify whether Union sell-side entities, where those entities are
responsible on behalf of the sell-side parties in the transaction, comply with due
diligence requirements set in Regulation (EU) 2017/2402. Investors should, however,
still verify whether have complied with their obligations for which third countries’
sell-side entities are responsible under Regulation (EU) 2017/2402.
(6) Senior tranches, typically benefiting from substantial credit enhancement and posing
lower risk, should require a less extensive due diligence review than junior or
mezzanine tranches, which bear higher risk and greater exposure to losses. That
proportional approach supports more efficient allocation of resources by investors and
avoids excessive burdens for low-risk investments.
(7) Since compliance with the STS requirements is already subject to separate regulatory
oversight and notification, the obligation for investors to verify compliance with those
requirements is redundant. Moreover, verifying compliance with the STS criteria is
not relevant for all types of investors. The corresponding requirement should therefore
be deleted.
(8) Investors should be allowed to conduct simplified due diligence to investments in
repeat transactions where key risk characteristics are already well understood. For
those purposes, investment in repeat transactions should be considered as investment
in securitisation positions issued by the same originator, backed by the same type of
underlying assets, exhibiting the same structural features, and offering the same or
lower level of credit risk compared to previous investments. That change should
ensure consistency in due diligence practices while facilitating investor participation in
well-known and transparent structures.
(9) Multilateral development banks can play a significant role in facilitating investor
access to securitisation markets, enhancing liquidity, and supporting the objectives of
the Savings and Investments Union. Where a securitisation position is fully,
EN 3 EN
unconditionally and irrevocably guaranteed by a multilateral development bank listed
in Article 117(2) of Regulation (EU) 575/2013 of the European Parliament and of the
Council20
, the credit risk arising from the securitisation position is effectively
transferred from the pool of underlying assets to the guarantor, resulting in a 0% risk
weight of such exposure. In addition, such securitisation position is categorised as
Level 1 asset under Article 10(1), point (g), of Commission Delegated Regulation
(EU) 2015/6121
. In such cases, it is appropriate to exempt institutional investors,
except the entity providing the guarantee, from their due diligence requirements in full
under Regulation (EU) 2017/2402.
(10) Transactions where the first loss tranche is either held or guaranteed by the Union,
national promotional banks or institutions within the meaning of point (3) of Article 2
of Regulation (EU) 2015/1017 of the European Parliament and of the Council22
inherently possess characteristics that mitigate the need to carry out the full due
diligence and fulfil the risk retention requirement. These transactions carry an
assurance by the guarantor, who carries out due diligence processes before affording
such a guarantee. This assessment removes the need for the institutional investors to
perform a full due diligence assessment under Regulation (EU) 2017/2402.
Furthermore, the essence of a guarantee is the assumption of risk by the guarantor.
Therefore, it is appropriate to lift the risk retention requirement. These changes are
expected to crowd in private investment in derisked structures with a public guarantee.
(11) An institutional investor that delegates the authority to make investment management
decisions to another institutional investor should be able to instruct the delegate to
perform the due diligence obligations set out in Regulation (EU) 2017/2402. However,
such delegation should not transfer legal responsibility. The delegating institutional
investor should remain ultimately responsible for ensuring compliance with the due
diligence requirements. That specification is intended to reflect established regulatory
practice and to ensure that obligations are fulfilled effectively while maintaining clear
lines of accountability.
(12) The disclosure requirements should consider the granularity of the underlying pool of
exposures, i.e. how many loans are in the underlying pool. In addition, it is important
to consider the average maturity of the underlying exposures. Loan level disclosure for
highly-granular pools of very short-term exposures can be particularly costly and
entails a considerable burden for issuers, often without offering significant benefits in
terms of additional information to investors. Therefore, disclosure requirements for
securitisations of credit card exposures and certain types of consumer loans should not
need to encompass reporting at the level of each individual underlying exposure.
However, competent authorities should still have the possibility to ask for additional
information to ensure that they have a complete overview of the market, including on
20
Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on
prudential requirements for credit institutions and amending Regulation (EU) No 648/201 (OJ L 176,
27.6.2013, p. 1, ELI: http://data.europa.eu/eli/reg/2013/575/oj).
21
Commission Delegated Regulation (EU) 2015/61 of 10 October 2014 to supplement Regulation (EU)
No 575/2013 of the European Parliament and the Council with regard to liquidity coverage requirement
for Credit Institutions (OJ L 11, 17.1.2015, p. 1, ELI: http://data.europa.eu/eli/reg_del/2015/61/oj).
22
Regulation (EU) 2015/1017 of the European Parliament and of the Council of 25 June 2015 on the
European Fund for Strategic Investments, the European Investment Advisory Hub and the European
Investment Project Portal and amending Regulations (EU) No 1291/2013 and (EU) No 1316/2013 — the
European Fund for Strategic Investments (OJ L 169, 1.7.2015, p. 1).
EN 4 EN
the exposures that constitute the underlying pool, in carrying out their duties under
Regulation (EU) 2017/2402.
(13) The current reporting templates23
both for public and private securitisations are too
costly and burdensome. The burden on entities when complying with their reporting
obligations should be therefore reduced, without undermining the goal of providing
transparency to the market. The reporting templates should be streamlined to reduce
the number of mandatory data fields. The revision of the template should aim to bring
a reduction of at least 35% of mandatory data fields. The conversion of certain
mandatory fields into voluntary fields could add further flexibility, but appropriate
attention should be given to ensure that that does not compromise data quality or
usability.
(14) The reporting framework should account for the specific characteristics of private
securitisations. A dedicated and simplified reporting template for private
securitisations should be developed. In specifying the details of reporting
requirements, the information required to be reported should be aligned as closely as
possible with other well-established templates, in particular with the guide on the
notification of securitisation transactions developed by the European Central Bank in
accordance with Article 6(5), point (a), of Council Regulation (EU) No 1024/201324
.
Any future changes to the European Central Bank guide should be assessed and the
reporting templates may need to be reviewed, where appropriate. To allow for basic
visibility for supervisors over the private market, private securitisations should report
to repositories. Private securitisations should not need to report the same amount of
information as public securitisations. Requiring private transactions to report to
securitisation repositories, using a simplified template, would improve supervisory
oversight and market monitoring. However, to maintain the confidentiality of private
transactions, data from those transactions should not be publicly disclosed.
(15) The securitisation sub-committee of the Joint Committee of the European Supervisory
Authorities (the “Joint Committee Securitisation Committee - JCSC”), referred to in
Article 36(3) of Regulation (EU) 2017/2402, under the leadership of the European
Banking Authority (EBA), should develop draft regulatory technical standards to
further specify the information that the originator, sponsor and SSPE are to provide to
comply with the reporting obligation. Those draft regulatory technical standards
should take into account the usefulness of the information for the holder of the
securitisation position, whether the securitisation is public or private, whether the
securitisation position is of a short-term nature and, in the case of an asset-backed
commercial paper programme (ABCP) transaction, whether it is fully supported by a
sponsor. The Commission should be empowered to supplement Regulation (EU)
2017/2402 by adopting those regulatory technical standards by means of delegated
acts pursuant to Article 290 of the Treaty on the Functioning of the European Union
23
Commission Delegated Regulation (EU) 2020/1224 of 16 October 2019 supplementing Regulation (EU)
2017/2402 of the European Parliament and of the Council with regard to regulatory technical standards
specifying the information and the details of a securitisation to be made available by the originator,
sponsor and SSPE and Commission Implementing Regulation (EU) 2020/1225 of 29 October 2019 laying
down implementing technical standards with regard to the format and standardised templates for making
available the information and details of a securitisation by the originator, sponsor and SSPE (OJ L 289,
3.9.2020, p. 1, ELI: http://data.europa.eu/eli/reg_del/2020/1224/oj).
24
Council Regulation (EU) No 1024/2013 of 15 October 2013 conferring specific tasks on the European
Central Bank concerning policies relating to the prudential supervision of credit institutions (OJ L 287,
29.10.2013, p. 63, ELI: http://data.europa.eu/eli/reg/2013/1024/oj).
EN 5 EN
(TFEU) and in accordance with Regulation (EU) No 1093/2010 of the European
Parliament and of the Council25
, Regulation (EU) No 1094/2010 of the European
Parliament and of the Council26
and Regulation (EU) No 1093/2010 of the European
Parliament and of the Council27
. Moreover, the JCSC, under the leadership of the
EBA, should develop draft implementing technical standards to specify the format for
the provision of the information to repositories. The Commission should be
empowered to adopt those implementing technical standards by means of an
implementing act pursuant to Article 291 TFEU and in accordance with Regulations
(EU) No 1093/2010, (EU) No 1094/2010 and (EU) No 1095/2010.
(16) To support access to market-based financing for SMEs, and to facilitate the
development of cross-border securitisations involving exposures from multiple
Member States, the criteria for the homogeneity of asset pools should be revised.
While it is possible to have securitisations involving exposures from multiple Member
States, the requirement of homogeneity, as defined at present, is considered as an
obstacle for SMEs securitisations. To overcome that obstacle, a pool of underlying
exposures should be deemed homogeneous where at least 70 % of the exposures at
origination consists of exposures to SMEs. That lower threshold recognises the
specific financing needs and characteristics of SMEs and ensures that mixed pools
with a predominant SME component can benefit from the legal certainty and
operational efficiencies associated with homogeneous pools. The remaining portion of
the pool should be allowed to include other types of exposures, also from different
Member States, without affecting the securitisation’s status as STS.
(17) In 2021, Regulation (EU) 2017/2402 was amended by Regulation (EU) 2021/557 of
the European Parliament and of the Council28
to extend the STS framework to
synthetic securitisations. As indicated in the report of the Joint Committee of
European Supervisory Authorities, that extension of the STS label has led to
satisfactory results in terms of opening the way for new issuance and encouraging
greater activity in this market segment. However, the practical implementation of the
STS requirements has revealed the necessity to further improve the clarity and
consistency in specific requirements with some technical adjustments.
(18) To ensure the consistent selection of the underlying exposures in a securitisation and
to enable investors to assess the credit risk of the asset pool prior to investment, active
portfolio management on a discretionary basis of a securitisation exposure is
prohibited. Article 26b of Regulation (EU) 2017/2402 contains an exhaustive list of
25
Regulation (EU) No 1093/2010 of the European Parliament and of the Council of 24 November 2010
establishing a European Supervisory Authority (European Banking Authority), amending Decision No
716/2009/EC and repealing Commission Decision 2009/78/EC (OJ L 331, 15.12.2010, p. 12, ELI:
http://data.europa.eu/eli/reg/2010/1093/oj).
26
Regulation (EU) No 1094/2010 of the European Parliament and of the Council of 24 November 2010
establishing a European Supervisory Authority (European Insurance and Occupational Pensions
Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/79/EC (OJ L
331, 15.12.2010, p. 48)
27
Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010
establishing a European Supervisory Authority (European Securities and Markets Authority), amending
Decision No 716/2009/EC and repealing Commission Decision 2009/77/EC (OJ L 331, 15.12.2010, p.
84)
28
Regulation (EU) 2021/557 of the European Parliament and of the Council of 31 March 2021 amending
Regulation (EU) 2017/2402 laying down a general framework for securitisation and creating a specific
framework for simple, transparent and standardised securitisation to help the recovery from the COVID-
19 crisis (OJ L 116, 6.4.2021, p. 1, ELI: http://data.europa.eu/eli/reg/2021/557/oj).
EN 6 EN
permitted management activities and stipulates that certain activities should not be
considered active portfolio management on a discretionary basis and therefore not be
prohibited. It is necessary to update that list to include removals due to sanctions
imposed on an entity during the life of the transaction or fraudulent practices, or
amendments to the loan due to a change in the law affecting the enforceability, which
are outside the control of the originator. Both circumstances would have an impact on
the enforceability of the underlying exposures (beyond the control of the originator)
and the removal of those underlying exposures should not be considered as active
portfolio management on a discretionary basis.
(19) The criteria relating to standardisation laid down in Article 26c of Regulation (EU)
2017/2402 outline the mechanisms for loss allocation to securitisation position holders
and determine the application of various amortisation methods to tranches. The central
aim of those criteria is to ensure that non-sequential amortisation is employed only
when accompanied by distinctly specified contractual triggers. Those triggers are
intended to prompt a switch to sequential payments based on the hierarchy of
seniority, thereby protecting the transaction from the premature amortisation of credit
enhancement in the event of a decline in credit quality. Such premature amortisation
could expose originators holding those tranches to risks associated with a diminishing
credit enhancement cushion. However, those criteria fail to adequately consider the
loss-bearing capacity of tranches subordinated to the protected tranches within a
securitisation, leading to misapplication when interpreted literally in the context of
synthetic securitisations that include mezzanine tranches. Those criteria inadvertently
assume that all associated losses fall solely on the protected tranche, and thus ignoring
an assignment to more junior tranches. It should therefore be specified that, in
instances where junior tranches absorb portions of the underlying exposure losses,
their loss-bearing capacities should be taken into consideration for the application of
the criteria.
(20) Article 26e(3) of Regulation (EU) 2017/2402 currently specifies that the credit
protection premiums to be paid under the credit protection agreement are to be
structured as contingent on the outstanding nominal amount of the performing
securitised exposures at the time of the payment and reflect the risk of the protected
tranche. To ensure the effectiveness of the credit protection agreement from the
originators’ perspective and at the same time provide legal certainty for investors on
the termination date to make payments by specifying the maximum extension period
for the debt workout, it should be specified that only credit protection premiums
contingent on the size of the outstanding tranche and credit risk of the protected
tranche are allowed.
(21) Article 26e(7) of Regulation (EU) 2017/2402 specifies the conditions under which an
originator may commit synthetic excess spread as credit enhancement for investors.
One of those conditions is that, for originators not using the IRB Approach referred to
in Article 143 of Regulation (EU) No 575/2013, the calculation of the one-year
expected loss of the underlying portfolio is to be clearly determined in the transaction
documentation. In order to specify the requirements for the synthetic excess spread
committed by the originator and available as credit enhancement for the investors, a
specific criterion has been introduced in the 2021 amendment to Regulation (EU)
2017/2402. The application of this criterion has shown that it requires further
clarification. In addition, an inconsistency has been identified regarding the
requirements for originators not using the IRB Approach. That requirement should be
amended to align with the intent to set a cap, equivalent to one year's expected loss, on
EN 7 EN
the total amount of synthetic excess spread that the originator should commit per year,
thereby ensuring consistency and clarity in the application of that provision.
(22) The current criterion requiring credit protection is to be funded in the STS framework
for on-balance-sheet synthetic securitisation under the STS regime has limited the
ability of insurance or reinsurance companies to participate in the on-balance-sheet
STS securitisation market. That is detrimental to the development of the STS market
and the ability of originators to transfer credit risk outside the banking system.
Allowing unfunded credit protection to be eligible for the STS label should, however,
not undermine the quality of the STS label or the reliability of the credit protection
agreement, nor should it create incentives for inexperienced or undiversified insurance
or reinsurance undertakings to become exposed to high levels of risk. It is therefore
appropriate to put in place safeguards to ensure that participation is limited to insurers
with a certain level of robustness and diversification. Therefore, eligibility for
providing unfunded credit protection under the STS label should be accompanied by
requirements related to diversification, solvency, risk measurement, and minimum size
of the protection provider. Specifically, when it comes to risk measurement, the
insurance or reinsurance undertaking should use an approved internal model to
calculate capital requirements for such credit protection agreements. When it comes to
solvency, the insurance or reinsurance undertaking should comply with the Solvency
Capital Requirement and Minimum Capital Requirement referred to in Articles 100
and 128 of Directive 2009/138/EC, respectively, and should have been assigned to
credit quality step 3 or better. When it comes to diversification, the insurance or
reinsurance undertaking should effectively operate business activities in at least two
classes of non-life insurance, which should reduce overexposure to any single risk
type. Finally, when it comes to minimum size, the insurance or reinsurance
undertaking should have total assets above EUR 20 billion.
(23) Third-party verifiers have a role in assessing the compliance of securitisations to the
STS criteria. Regulation (EU) 2017/2402 only requires third-party verifiers to be
authorised by national competent authorities. Such authorisation is, however, of
limited assurance if competent authorities are not in position to assess whether those
third-party verifiers continue to comply with the conditions for their authorisation on
an ongoing basis. It is therefore appropriate to lay down that competent authorities are
also responsible for the ongoing supervision of such third-party verifiers and
adequately empowered to do so.
(24) To ensure the effective implementation and enforcement of Regulation (EU)
2017/2402, it is necessary to clarify the responsibilities of competent authorities in
supervising the compliance of all relevant parties involved in a securitisation.
Competent authorities should oversee the conduct of originators, sponsors, original
lenders, and SSPEs. This includes verification of whether individual securitisation
transactions comply with the applicable requirements under this Regulation.
(25) In order to strengthen compliance with, and to enhance the effectiveness of,
Regulation (EU) 2017/2402, the scope of sanctioning powers under Article 32 of that
Regulation should be broadened to explicitly include infringements of due diligence
obligations. Institutional investors play a key role in ensuring the soundness and
transparency of the securitisation market by conducting appropriate due diligence
before and during their exposures. To ensure consistent enforcement across the Union
of those due diligence requirements, it should be specified that failure to comply with
those requirements is to be subject to remedial measures and administrative sanctions
by competent authorities.
EN 8 EN
(26) Fostering supervisory convergence is essential to the proper functioning and further
development of the securitisation market which brings together a wide range of
economic actors often based in different jurisdictions, even for the same transaction.
The involvement of several competent authorities, combined with the current
complexity of the decision-making process, highlights the need to strengthen the
supervisory coordination. Simplifying and reinforcing existing frameworks for
supervisory coordination, where feasible, should support the broader aim of
simplification in regulation and supervision. Stronger convergence can be achieved by
using more efficiently and effectively existing powers that allocated to the ESAs and
the competent authorities. This outcome should be also supported by giving a more
prominent role to the EBA, which should assume permanent stewardship of
supervision coordination issues for the securitisation market in the Union.
(27) The Joint Committee Securitisation Committee, composed of market and prudential
competent authorities, should focus on issues stemming from supervision and should
facilitate and promote supervisory convergence through common supervisory
practices. The current mandate of the JCSC should be reviewed to put emphasis on
supervisory convergence and work related to Article 44 of this Regulation. The JCSC
can meet in different formats or establish subgroups for specific tasks according to the
issues to be discussed. The EBA should provide the secretariat and a vice-chairperson
for the Joint Committee Securitisation Committee on a permanent basis, deputising
and supporting the chairperson in the exercise of his or her duties. In the absence of
the chairperson, the vice-chairperson should perform the tasks of the chairperson,
including in situations where no chairperson is elected. Representatives to this body
from participating market and prudential competent authorities should have the
appropriate level of knowledge and experience in matters under discussion. The
regular monitoring of the state of the market and evaluation of the supervisory
securitisation framework in the Union through monitoring reports, development of
guidelines and regular peer reviews would further strengthen the supervisory
framework promoting best (supervisory) practices.
(28) Given that securitisation activity in the Union is primarily concentrated in the banking
sector, it is appropriate that the EBA assumes the permanent stewardship role in the
Joint Committee Securitisation Committee. In the exercise of its permanent role in the
Joint Committee Securitisation Committee, the EBA should attach particular attention
to nourishing strong and collaborative working relationships with the European
Securities Markets Authority (ESMA) and the European Insurance and Occupational
Pensions Authority (EIOPA) and duly taking account of their sectoral perspectives. It
should be expected that such reinforced supervisory coordination will result in more
robust and consistent supervision of the securitisation market in the Union. In this
capacity, the EBA should also lead the work on the development of the disclosure
templates as provided for in Article 7 of this Regulation. This will be instrumental in
preparing the market for the anticipated growth and developing supervisory capacity
and preparedness to support this expansion. Assigning a stewardship role to EBA in
this supervisory capacity aligns with the strategic vision of an efficient and simplified
regulatory landscape.
(29) In case of cross-border securitisations, appointing a lead supervisor would streamline
the supervision of compliance with Regulation (EU) 2017/2402 and ensure
consistency and better coordination among the different competent authorities. The
lead supervisor should be appointed from among the competent authorities of the
entities involved in the transaction, with the decision taken by the competent
EN 9 EN
authorities concerned. In case of disagreements the matter should be dealt with at the
level of the Joint Committee Securitisation Committee. Whenever a new transaction
involves entities supervised by the same competent authorities, the lead previously
appointed can keep that role.
(30) It is important to ensure that the regulatory framework for securitisations remains
effective and adapts to the evolving financial landscape. For that reason, the
Commission should comprehensively review the impact and functionality of this
Regulation within 5 years after its adoption, with careful attention to its influence on
the securitisation market and its broader economic implications. That review should
focus on critical aspects, including market dynamics, the accessibility of credit in
particular for SMEs, investments, and the interconnectedness of financial institutions
which is vital for maintaining the stability of the financial sector. Combining insights
from the reports referred to in Article 44 of Regulation (EU) 2017/2402 and further
analyses, the Commission should determine the necessity for legislative updates to
safeguard the role of Regulation (EU) 2017/2402 in supporting a resilient and dynamic
economy within the European Union.
(31) Since the objectives of this Regulation cannot be sufficiently achieved by the Member
States given that securitisation markets operate globally and that a level playing field
in the internal market for all institutional investors and entities involved in
securitisation should be ensured but, by reason of their scale and effects, can be better
achieved at Union level, the Union may adopt measures, in accordance with the
principle of subsidiarity set out in Article 5 of the Treaty on European Union. In
accordance with the principle of proportionality as set out in that Article, this
Regulation does not go beyond what is necessary in order to achieve those objectives.
(32) Regulation (EU) 2017/2402 should therefore be amended accordingly,
HAVE ADOPTED THIS REGULATION:
Article 1
Amendment to Regulation (EU) No 2017/2402
Regulation (EU) 2017/2402 is amended as follows:
(1) in Article 1, paragraph 2 is replaced by the following:
‘This Regulation applies to institutional investors and to originators, sponsors,
original lenders, servicers and securitisation special purpose entities.’;
(2) in Article 2, the following points (32) and (33) are added:
‘(32) ‘public securitisation’ means a securitisation that meets any of the following
criteria:
(a) a prospectus has to be drawn up for that securitisation pursuant to Article
3 of Regulation (EU) 2017/1129 of the European Parliament and of the
Council29
;
29
Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the
prospectus to be published when securities are offered to the public or admitted to trading on a
regulated market, and repealing Directive 2003/71/EC (OJ L 168, 30.6.2017, p. 12,
ELI: http://data.europa.eu/eli/reg/2017/1129/oj).
EN 10 EN
(b) the securitisation is marketed with notes constituting securitisation
positions admitted to trading on a Union trading venue as defined in
Article 4(1), point (24) of Directive 2014/65/EU of the European
Parliament and of the Council30
;
(c) the securitisation is marketed to investors and the terms and conditions
are not negotiable among the parties.
(33) ‘private securitisation’ means a securitisation that does not meet any of the
criteria laid down in point (32).’
(3) Article 5 is amended as follows:
(a) paragraph 1 is amended as follows:
(i) point (c) is deleted;
(ii) points (e) and (f) are replaced by the following:
‘(e) if established in a third country, the originator, sponsor or SSPE
designated in accordance with Article 7(2) has made available the
information required by Article 7(1) in accordance with the frequency
and modalities provided for in that paragraph;
(f) if established in a third country, in the case of non-performing
exposures, the originator, sponsor or original lender has applied sound
standards in the selection and pricing of the exposures.’;
(b) paragraph 3 is amended as follows:
(i) point (b) is replaced by the following:
‘(b) all the structural features of the securitisation that can materially
impact the performance of the securitisation position;’;
(ii) point (c) is deleted;
(c) paragraph 4 is amended as follows:
(i) in point (a), the second subparagraph is deleted;
(ii) the following point (g) is added:
‘(g) in the case of secondary market investments, document the due
diligence assessment and verifications within a reasonable period of
time which in any case shall not exceed 15 calendar days after the
investment.’;
(d) the following paragraphs 4a and 4b are inserted:
‘(4a) Paragraphs 1 to 4 shall not apply to institutional investors that hold a
securitisation position where such securitisation position is guaranteed by a
multilateral development bank listed in Article 117(2) of Regulation (EU) No
575/2013.
For the purposes of the first subparagraph, the guarantee shall meet the conditions
of Article 213 and 215 of Regulation (EU) No 575/2013.
30
Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in
financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (recast) (OJ L
173, 12.6.2014, p. 349, ELI: http://data.europa.eu/eli/dir/2014/65/oj).’;
EN 11 EN
(4b) Paragraphs 1 and 4 shall not apply to institutional investors that hold a
securitisation position where the first loss tranche representing at least 15% of the
nominal value of the securitised exposures is either held or guaranteed by the
Union or by national promotional banks or institutions within the meaning of
point (3) of Article 2 of Regulation (EU) 2015/1017 of the European Parliament
and of the Council.’;
(e) paragraph 5 is replaced by the following:
‘(5) Without prejudice to paragraphs 1 to 4 of this Article, where an institutional
investor has given another institutional investor authority to make investment
management decisions that might expose it to a securitisation, the delegating
institutional investor may instruct the delegated institutional investor to fulfil its
obligations under this Article in respect of any exposure to a securitisation arising
from those decisions. The delegating institutional investor’s liability under this
Article shall not be affected by the fact that the institutional investor has delegated
functions.’
(4) Article 6 is amended as follows:
(a) in paragraph 5 point (f) is added:
‘(f) the Union.’
(b) paragraph 5a is inserted:
‘(5a) Paragraph 1 shall not apply where the first loss tranche representing at least
15% of the nominal value of the securitised exposures is either held or guaranteed
by one of the entities listed under points (a) to (f) of paragraph 5.’
(5) Article 7 is amended as follows:
(a) in paragraph 1 the fourth subparagraph is replaced by the following:
‘In the case of an ABCP or of a securitisation of highly-granular pools of short-
term exposures, the information described in points (a), (c)(ii) and (e)(i) of the
first subparagraph shall be made available in aggregate form to holders of
securitisation positions and, upon request, to potential investors.’;
(b) in paragraph 2, the third subparagraph is replaced by the following:
‘Private securitisations shall be subject to a distinct reporting framework that
acknowledges their unique characteristics, differing from public securitisation, in
a dedicated and simplified reporting template. That dedicated and simplified
reporting template shall ensure that essential information relevant to national
competent authorities is adequately reported, without imposing the full extent of
reporting obligations applicable to public securitisations. Private securitisations
shall fulfil their obligations under this subparagraph as of [date set in the fourth
subparagraphs of paragraphs 3 and 4 of this Article.].’
(c) paragraph 3 is replaced by the following:
‘3. The ESAs shall develop, through the Joint Committee of the European
Supervisory Authorities, under the leadership of the EBA and in close cooperation
with ESMA and EIOPA, draft regulatory technical standards in accordance with
Articles 10 to 14 of Regulations (EU) No 1093/2010, (EU) No 1094/2010 and
(EU) No 1095/2010 to specify the information that the originator, sponsor and
EN 12 EN
SSPE shall provide to comply with paragraph 1, first subparagraph, points (a) and
(e), and paragraph 2 taking into account:
(a) the usefulness of information for the holder of the securitisation position and
for supervisors;
(b) whether the securitisation is public or private;
(c) whether the securitisation position is of a short-term nature;
(d) in the case of an ABCP transaction, whether that transaction is fully
supported by a sponsor.
The ESAs, through the Joint Committee of the European Supervisory Authorities,
under the leadership of the EBA and in close cooperation with ESMA and
EIOPA, shall submit those draft regulatory technical standards to the Commission
by [6 months after the date of entry into force of this amending Regulation].
The Commission is empowered to supplement this Regulation by adopting the
regulatory technical standards referred to in this paragraph in accordance with
Articles 10 to 14 of Regulations (EU) No 1093/2010, (EU) No 1094/2010 and
(EU) No 1095/2010.
The regulatory technical standards shall enter into force [12 months] after the
adoption by the Commission.
At least every three years from the date of their adoption by the Commission the
ESAs, through the Joint Committee of the European Supervisory Authorities,
shall assess the regulatory technical standards to determine their continued
relevance and accuracy, to ensure they remain effective, up to date, aligned with
market practices and needs. The ESAs, through the Joint Committee of the
European Supervisory Authorities, shall inform the Commission of the results of
the assessment.’
(d) paragraph 4 is replaced by the following:
‘4. In order to ensure uniform conditions of application for the information to
be specified in accordance with paragraph 3, the ESAs, through the Joint
Committee of the European Supervisory Authorities, under the leadership of the
EBA and in close cooperation with ESMA and EIOPA, shall develop draft
implementing technical standards in accordance with Article 15 of Regulations
(EU) No 1093/2010, (EU) No 1094/2010 and (EU) No 1095/2010 specifying the
format thereof by means of standardised templates.
The ESAs, through the Joint Committee of the European Supervisory Authorities,
shall submit those draft implementing technical standards to the Commission by
[6 months after the date of entry into force of this amending Regulation].
The Commission is empowered to adopt the implementing technical standards
referred to in this paragraph in accordance with Article 15 of Regulations (EU)
No 1093/2010, (EU) No 1094/2010 and (EU) No 1095/2010.
The implementing technical standards shall enter into force [12 months] after the
adoption by the Commission.
At least every three years from the date of their adoption by the Commission the
ESAs, through the Joint Committee of the European Supervisory Authorities,
shall assess the implementing regulatory technical standards to determine their
EN 13 EN
continued relevance and accuracy, to ensure they remain effective, up to date,
aligned with market practices and needs. The ESAs, through the Joint Committee
of the European Supervisory Authorities, shall inform the Commission of the
results of that assessment.’;
(6) Article 10 is amended as follows:
(a) paragraph 1 is replaced by the following:
‘1. A securitisation repository shall register with ESMA for the purposes of
Article 7 under the conditions and the procedure set out in this Article.’;
(b) paragraph 2 is replaced by the following:
‘2. To be eligible to be registered under this Article, a securitisation repository
shall be a legal person established in the Union, apply procedures to verify the
completeness and consistency of the information made available to it under
Article 7(1) of this Regulation, and meet the requirements laid down in in Articles
78 and 79, and Article 80(1), (2), (3), (5) and (6) of Regulation (EU) No
648/2012. For the purposes of this Article, references in Articles 78 and 80 of
Regulation (EU) No 648/2012 to Article 9 thereof shall be construed as references
to Article 7 of this Regulation.’
(7) Article 17 is amended as follows:
(a) paragraph 1 is replaced by the following:
‘1. Without prejudice to Article 7(2), the securitisation repository referred to in
Article 10 shall collect and maintain details of the securitisation. It shall provide
direct and immediate access free of charge to all of the following entities to enable
them to fulfil their respective responsibilities, mandates and obligations:
(a) the EBA;
(b) EIOPA;
(c) ESMA;
(d) the ESRB;
(e) the relevant members of the European System of Central Banks (ESCB),
including the European Central Bank (ECB) in carrying out its tasks within
a single supervisory mechanism under Regulation (EU) No 1024/2013;
(f) the relevant authorities whose respective supervisory responsibilities and
mandates cover transactions, markets, participants and assets which fall
within the scope of this Regulation;
(g) the resolution authorities designated under Article 3 of Directive
2014/59/EU of the European Parliament and the Council31
;
(h) the Single Resolution Board established by Regulation (EU) No 806/2014
of the European Parliament and of the Council32
;
31
Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a
framework for the recovery and resolution of credit institutions and investment firms and amending
Council Directive 82/891/EEC, and Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC,
2007/36/EC, 2011/35/EU, 2012/30/EU and 2013/36/EU, and Regulations (EU) No 1093/2010 and (EU)
No 648/2012, of the European Parliament and of the Council (OJ L 173, 12.6.2014, p. 190,
ELI: http://data.europa.eu/eli/dir/2014/59/oj).
EN 14 EN
(i) the authorities referred to in Article 29 of this Regulation;
(j) the Commission, upon request;
(k) in case of public securitisations, investors and potential investors.’
(b) in paragraph 2, point (a) is deleted.
(8) Article 20 is amended as follows:
(a) in paragraph 8, the following subparagraph is added:
‘A pool of underlying exposures shall be deemed to comply with the first
subparagraph where at least 70% of the exposures in the pool at origination
consists of exposures to SMEs.’;
(b) in paragraph 11, in point (a), point (ii) is replaced by the following:
‘(ii) the information provided by the originator, sponsor and SSPE explicitly sets
out the proportion of restructured underlying exposures, the time and details
of the restructuring, and their performance since the date of the
restructuring;’;
(9) Article 22 is amended as follows:
(a) in paragraph 4, the first subparagraph is replaced by the following:
‘In case of a securitisation where the underlying exposures are residential loans or
auto loans or leases, the originator and sponsor shall publish the available
information related to the environmental performance of the assets financed by
such residential loans or auto loans or leases.’;
(b) paragraph 5 is replaced by the following:
‘5. The originator and the sponsor shall be responsible for compliance with
Article 7. In case of a public securitisation, the information required by Article
7(1), first subparagraph, point (a), shall be made available to potential investors
before pricing upon request. In case of a public securitisation, the information
required by Article 7(1), first subparagraph, points (b) to (d), shall be made
available before pricing at least in draft or initial form. The final documentation
shall be made available to investors at the latest 15 days after closing of the
transaction.’;
(10) Article 24 is amended as follows:
(a) in paragraph 9, in point (a), point (ii) is replaced by the following:
‘(ii) the information provided by the originator, sponsor and SSPE explicitly sets
out the proportion of restructured underlying exposures, the time and details
of the restructuring, and their performance since the date of the
restructuring;’;
(b) in paragraph 15 the following subparagraph is added:
32
Regulation (EU) No 806/2014 of the European Parliament and of the Council of 15 July 2014
establishing uniform rules and a uniform procedure for the resolution of credit institutions and certain
investment firms in the framework of a Single Resolution Mechanism and a Single Resolution Fund and
amending Regulation (EU) No 1093/2010 (OJ L 225, 30.7.2014, p. 1,
ELI: http://data.europa.eu/eli/reg/2014/806/oj).
EN 15 EN
‘A pool of underlying exposures shall be deemed to comply with the first
subparagraph where at least 70% of the exposures in the pool at origination
consists of exposures to SMEs.’;
(11) Article 26b is amended as follows:
(a) in paragraph 7, in the fourth subparagraph, the following points (e) and (f) are
added:
‘(e) has been the object of Union restrictive measures or of proven fraudulent
practices;
‘(f) has been subject to changes in the national legal framework that would
affect the enforceability of the claims of the underlying exposures.’;
(b) in paragraph 8, the following subparagraph is added:
‘A pool of underlying exposures shall be deemed to comply with the first
subparagraph where at least 70% of the exposures in the pool at origination
consists of exposures to SMEs.’;
(c) in paragraph 11, in point (a), point (ii) is replaced by the following:
‘(ii) the information provided by the originator, sponsor and SSPE explicitly sets
out the proportion of restructured underlying exposures, the time and details
of the restructuring, and their performance since the date of the
restructuring;’;
(12) in Article 26c, in paragraph 5, the eighth subparagraph is replaced by the following:
‘Where a credit event, as referred to in Article 26e, has occurred in relation to
underlying exposures and the debt workout for those exposures has not been
completed, the amount of credit protection remaining at any payment date plus the
amount of any retained tranches which rank junior to the tranches covered by the
credit protection remaining at any payment date shall be at least equivalent to the
outstanding nominal amount of those underlying exposures, minus the amount of
any interim payment made in relation to those underlying exposures.’;
(13) Article 26e is amended as follows:
(a) in paragraph 3, the third subparagraph is replaced by the following:
‘The credit protection premiums to be paid under the credit protection agreement
shall be structured as contingent on the outstanding size of the tranche and credit
risk of the protected tranche. For those purposes, the credit protection agreement
shall not stipulate guaranteed premiums, upfront premium payments, rebate
mechanisms or other mechanisms that may avoid or reduce the actual allocation
of losses to the investors or return part of the paid premiums to the originator after
the maturity of the transaction.’;
(b) in paragraph 7, point (d) is replaced by the following:
‘(d) for originators not using the IRB Approach referred to in Article 143 of
Regulation (EU) No 575/2013:
(i) the total committed amount per year shall not be higher than the one-
year expected loss of the portfolio for that year;
(ii) the calculation of the one-year expected loss of the underlying portfolio
shall be clearly determined in the transaction documentation.’;
EN 16 EN
(c) paragraph 8 is amended as follows:
(i) the following point (aa) is inserted:
‘(aa) a guarantee meeting the requirements set out in Part Three, Title II,
Chapter 4 of Regulation (EU) No 575/2013, by which the credit risk
is transferred to an insurance or reinsurance undertaking that meets all
of the following criteria:
(i) the undertaking uses an internal model approved in accordance
with Articles 112 and 113 of Directive 2009/138/EC for the
calculation of capital requirements for such guarantees;
(ii) the undertaking complies with its Solvency Capital Requirement
and its Minimum Capital Requirement referred to in Articles
100 and 128 of Directive 2009/138/EC, respectively, and has
been assigned to credit quality step 3 or better;
(iii) the undertaking effectively operates business activities in at least
two classes of non-life insurance within the meaning of Annex I
to Directive 2009/138/EC;
(iv) the assets under management by the insurance or reinsurance
undertaking exceed 20 billion euro;
(ii) point (c) is replaced by the following:
(c) another credit protection not referred to in points (a), (aa) and
(b) of this paragraph in the form of a guarantee, a credit
derivative or a credit linked note that meets the requirements set
out in Article 249 of Regulation (EU) No 575/2013, provided
that the obligations of the investor are secured by collateral
meeting the requirements laid down in paragraphs 9 and 10 of
this Article.’;
(14) in Article 28(1), first subparagraph, the introductory wording is replaced by the
following:
‘A third party as referred to in Article 27(2) shall be authorised and supervised by
the competent authority to assess compliance of securitisations with the STS
criteria provided for in Articles 19 to 22, Articles 23 to 26, and Articles 26a
to 26e. The competent authority shall grant the authorisation if the following
conditions are met:’;
(15) Article 29 is amended as follows:
(a) the following paragraph 4a is inserted:
‘4a. Competent authorities responsible for the supervision of originators,
sponsors and SSPEs in accordance with Directive 2013/36/EU, including the ECB
with regard to specific tasks conferred on it by Regulation (EU) No 1024/2013,
shall supervise compliance by originators, sponsors and SSPEs with the
obligations set out in Articles 18 to 27 of this Regulation.’;
(b) in paragraph 5, the first sentence is replaced by the following:
‘For entities supervised by competent authorities other than the ones referred to in
paragraph 4a, Member States shall designate one or more competent authorities to
EN 17 EN
supervise the compliance of originators, sponsors and SSPEs with Articles 18 to
27, and the compliance of third parties with Article 28.’;
(16) Article 30 is amended as follows
(a) the following paragraph 1a is inserted:
‘1a. The competent authority shall supervise the compliance of originators,
sponsors, SSPEs and original lenders with this Regulation in accordance with
Article 29.’;
(b) paragraph 5 is deleted.
(17) in Article 32(1), first subparagraph, the following point (i) is added:
‘(i) an institutional investor, other than the originator, sponsor or original lender,
has failed to meet the requirements provided for in Article 5.’;
(18) Article 36 is amended as follows:
(a) paragraph 2 is deleted
(b) paragraph 3, is replaced by the following:
‘A specific securitisation sub-committee shall be established within the
framework of the Joint Committee of the European Supervisory Authorities,
within which competent authorities shall closely cooperate, in order to carry out
their duties pursuant to Articles 30 to 34. The securitisation sub-committee shall
be led by the EBA with the cooperation of ESMA and EIOPA. The EBA shall
provide the secretariat and a vice-chairperson to the securitisation sub-committee
on a permanent basis. The securitisation sub-committee shall foster supervisory
convergence to ensure common supervisory practices. The members of the
securitisation sub-committee, under the stewardship of the EBA, shall closely
coordinate their supervisory actions in order to identify and remedy infringements
of this Regulation, develop and promote best practices, facilitate collaboration,
foster consistentapplication of law and provide cross-jurisdictional assessments in
the event of any disagreements. The securitisation sub-committee shall regularly
monitor the state of the market and the application of this Regulation.’;
(c) the following paragraphs 3a and 3b are inserted:
‘3a. The securitisation sub-committee referred to in paragraph 3 shall by [12
months after adoption] develop guidelines to establish common supervisory
procedures.
3b. Following the notification to the competent authorities under Article 7(1),
the competent authorities of the sell-side entities in the transaction shall appoint a
lead supervisor to coordinate actions and avoid divergences of application of this
Regulation for transactions involving sell-side entities under the remit of
competent authorities from more than one Member State. A competent authority
may delegate the exercise of some or all of the tasks and powers referred to in this
Regulation to the lead supervisor. In case the competent authorities of the sell-side
entities do not reach an agreement on the appointment of the lead supervisor, the
securitisation sub-committee established under paragraph 3 shall appoint the lead
supervisor.’;
(d) in paragraph 6, the first and second subparagraphs are replaced by the
following:
EN 18 EN
‘Upon receipt of the information referred to in paragraph 4, the competent
authority of the entity suspected of the infringement shall take within 15 working
days any action necessary to address the infringement identified and notify the
other competent authorities involved, in particular those of the originator, sponsor
and SSPE, and the competent authorities of the holder of a securitisation position,
where known. A competent authority that disagrees with another competent
authority regarding the procedure or content of the action or inaction or that other
competent authority shall notify all other competent authorities involved about its
disagreement without undue delay. Where that disagreement is not resolved
within three months of the date on which all competent authorities involved were
notified, the matter shall be referred to the EBA in accordance with Article 19
and, where applicable, Article 20 of Regulation (EU) No 1093/2010. The
conciliation period referred to in Article 19(2) of Regulation (EU) No 1093/2010
shall be one month.
Where the competent authorities concerned fail to reach an agreement within the
conciliation phase referred to in the first subparagraph, the EBA shall take the
decision referred to in Article 19(3) of Regulation (EU) No 1093/2010 within one
month. During the procedure set out in this Article, a securitisation appearing on
the list maintained by ESMA pursuant to Article 27 of this Regulation shall
continue to be considered an STS pursuant to Chapter 4 of this Regulation and
shall be kept on that list.’;
(e) paragraph 7 is replaced by the following
‘7. Three years from the date of application of this Regulation, and every three
years thereafter, the EBA, in cooperation with ESMA and EIOPA, shall conduct a
peer review in accordance with Article 30 of Regulation (EU) No 1093/2010 on
the implementation of the supervisory powers provided for in Article 30 of this
Regulation.’;
(f) paragraph 8 is deleted;
(19) Article 44 is amended as follows:
(a) in the first subparagraph, point (e) is replaced by the following:
‘(e) the contribution of securitisation to funding Union companies and to the
economy of the Union.’;
(b) the second subparagraph is deleted;
(20) Article 46 is replaced by the following:
’Article 46
Review
By …[PO please insert the date: 5 years after date of entry into force], the Commission
shall present a report to the European Parliament and the Council on the functioning of
this Regulation, accompanied, where appropriate, by a legislative proposal.
That report shall consider in particular the findings of the reports referred to in Article
44, and shall assess:
(a) the effects of this Regulation on the functioning and the development of the
market for securitisations in the Union;
(b) the contribution of securitisation to:
EN 19 EN
(i) to funding EU companies and economy, in particular on access to credit for
SMEs and investments;
(ii) the interconnectedness between financial institutions and the stability of the
financial sector;
(c) whether in the area of STS securitisations, an equivalence regime could be
introduced for third country originators, sponsors and SSPEs, including in relation
to due-diligence requirements, taking into consideration international
developments in the area of securitisation, in particular initiatives on simple,
transparent and comparable securitisations;
(d) the implementation of the requirements set out in Article 22(4) and Article 26d(4)
and whether those requirements may be extended to securitisation where the
underlying exposures are not residential loans or auto loans or leases, with a view
to mainstreaming environmental, social and governance disclosures.
Article 2
Entry into force
This Regulation shall enter into force on the twentieth day following that of its publication in
the Official Journal of the European Union.
This Regulation shall be binding in its entirety and directly applicable in all Member States.
Done at Strasbourg,
For the European Parliament For the Council
The President The President
EN 1 EN
LEGISLATIVE FINANCIAL AND DIGITAL STATEMENT – AGENCIES
1. FRAMEWORK OF THE PROPOSAL/INITIATIVE................................................. 3
1.1. Title of the proposal/initiative...................................................................................... 3
1.2. Policy area(s) concerned .............................................................................................. 3
1.3. Objective(s).................................................................................................................. 3
1.3.1. General objective(s) ..................................................................................................... 3
1.3.2. Specific objective(s)..................................................................................................... 3
1.3.3. Expected result(s) and impact...................................................................................... 3
1.3.4. Indicators of performance ............................................................................................ 4
1.4. The proposal/initiative relates to:................................................................................. 4
1.5. Grounds for the proposal/initiative .............................................................................. 4
1.5.1. Requirement(s) to be met in the short or long term including a detailed timeline for
roll-out of the implementation of the initiative............................................................ 4
1.5.2. Added value of EU involvement (it may result from different factors, e.g.
coordination gains, legal certainty, greater effectiveness or complementarities). For
the purposes of this section 'added value of EU involvement' is the value resulting
from EU action that is additional to the value that would have been otherwise created
by Member States alone............................................................................................... 4
1.5.3. Lessons learned from similar experiences in the past.................................................. 5
1.5.4. Compatibility with the multiannual financial framework and possible synergies with
other appropriate instruments....................................................................................... 5
1.5.5. Assessment of the different available financing options, including scope for
redeployment................................................................................................................ 6
1.6. Duration of the proposal/initiative and of its financial impact .................................... 7
1.7. Method(s) of budget implementation planned............................................................. 7
2. MANAGEMENT MEASURES................................................................................... 9
2.1. Monitoring and reporting rules .................................................................................... 9
2.2. Management and control system(s) ............................................................................. 9
2.2.1. Justification of the budget implementation method(s), the funding implementation
mechanism(s), the payment modalities and the control strategy proposed.................. 9
2.2.2. Information concerning the risks identified and the internal control system(s) set up
to mitigate them............................................................................................................ 9
2.2.3. Estimation and justification of the cost-effectiveness of the controls (ratio between
the control costs and the value of the related funds managed), and assessment of the
expected levels of risk of error (at payment & at closure)........................................... 9
2.3. Measures to prevent fraud and irregularities.............................................................. 10
3. ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE............ 11
EN 2 EN
3.1. Heading(s) of the multiannual financial framework and expenditure budget line(s)
affected....................................................................................................................... 11
3.2. Estimated financial impact of the proposal on appropriations................................... 12
3.2.1. Summary of estimated impact on operational appropriations (select, if appropriate,
also for decentralised agencies) ................................................................................. 12
3.2.1.1. Appropriations from voted budget............................................................................. 12
3.2.1.2. Appropriations from external assigned revenues (not to be completed for
decentralised agencies)............................................................................................... 15
3.2.2. Estimated output funded from operational appropriations (not to be completed for
decentralised agencies)............................................................................................... 16
3.2.3. Summary of estimated impact on administrative appropriations (not to be completed
for decentralised agencies)......................................................................................... 18
3.2.3.1. Appropriations from voted budget .............................................................................. 18
3.2.4. Estimated requirements of human resources (not to be completed for decentralised
agencies)..................................................................................................................... 18
3.2.4.1. Financed from voted budget....................................................................................... 18
3.2.5. Overview of estimated impact on digital technology-related investments (not to be
completed for decentralised agencies) ....................................................................... 19
3.2.6. Compatibility with the current multiannual financial framework (not to be completed
for decentralised agencies)......................................................................................... 20
3.2.7. Third-party contributions (not to be completed for decentralised agencies) ............. 20
3.2.8. Estimated human resources and the use of appropriations required in a decentralised
agency ........................................................................................................................ 20
3.3. Estimated impact on revenue (not to be completed for decentralised agencies) ....... 24
4. Digital dimensions (not to be completed for decentralised agencies)........................ 24
4.1. Requirements of digital relevance.............................................................................. 24
4.2. Data ............................................................................................................................ 24
4.3. Digital solutions ......................................................................................................... 24
4.4. Interoperability assessment........................................................................................ 24
4.5. Measures to support digital implementation.............................................................. 25
EN 3 EN
1. FRAMEWORK OF THE PROPOSAL/INITIATIVE
1.1. Title of the proposal/initiative
Regulation of the European Parliament and of the Council amending Regulation
(EU) 2017/2402 of the European Parliament and of the Council of 12 December
2017 laying down a general framework for securitisation and creating a specific
framework for simple, transparent and standardised securitisation.
1.2. Policy area(s) concerned
Policy area: Financial stability, financial services and Capital Markets Union
Activity: Financial markets
1.3. Objective(s)
1.3.1. General objective(s)
This initiative is one of the components of the Savings and Investments Union. This
proposal aims to:
(1) to revive a securitisation market that will improve financing of the EU economy
and
(2) to strike a better balance between safety and market development.
The aim is to create conditions and environment for greater lending to the real
economy. A well-functioning securitisation market will incentivise banks to be more
active in the market ultimately also making them lend more to the economy.
1.3.2. Specific objective(s)
This proposal has the following objectives:
(1) Reduction of high operational costs for issuers and investors balancing with
robust and proportionate standards of transparency, investor protection and
supervision;.
(2) Removal of regulatory barriers, allowing the market to develop in a more
sustainable and resilient way;
(3) Contribute to the Commission's effort to reduce the regulatory burden on market
participants.
Securitisation can be an important channel for diversifying funding sources and
allocating risk more efficiently within the EU financial system. It would allow for a
broader distribution of financial sector risk and can help to free up banks' balance
sheets to allow for further lending to the different categories of economic agent (e.g.
non-financial companies, SME, individuals). Overall, it can improve efficiencies in
the financial system and provide additional investment opportunities. Securitisation
can bridge banks and capital markets with an indirect benefit for businesses and
citizens (through, for example, less expensive loans, mortgages and credit cards).
1.3.3. Expected result(s) and impact
Specify the effects which the proposal/initiative should have on the beneficiaries / groups targeted.
Suggested changes will revitalise securitisation market and allow securitisation to
play a role in the development of the Savings and Investments Union and to reduce
EN 4 EN
burden and compliance costs for issuers and investors. By addressing the high
operational costs that have deterred banks and insurers from participating in the EU
securitisation market, proposed changes will contribute to the Commission's effort to
reduce the regulatory burden on market participants and stimulate market
development the use of securitisation. At the same time, the proposed changes will
continue to safeguard financial stability and provide an adequate level of investor
and consumer protection.
1.3.4. Indicators of performance
Specify the indicators for monitoring progress and achievements.
The following indicators will be used to monitor progress and achievements:
Monitoring the cost of conducting due diligence to invest in securitisation
transactions.
Monitoring issuance cost stemming from the reporting requirements.
Tracking the number of securitisation issuers and investors.
1.4. The proposal/initiative relates to:
 a new action
 a new action following a pilot project / preparatory action33
 the extension of an existing action
 a merger or redirection of one or more actions towards another/a new action
1.5. Grounds for the proposal/initiative
1.5.1. Requirement(s) to be met in the short or long term including a detailed timeline for
roll-out of the implementation of the initiative
The proposal presents a series of simplifications and refinements to enhance
efficiency within the securitisation market. Through targeted adjustments and
simplification, these measures are positioned to bolster the market's capacity, attract
a broader base of investors, and encourage economic growth—while maintaining a
resilient and transparent financial ecosystem. The changes are expected to boost the
competitiveness and sustainability of the EU Securitisation Framework, driving
growth for all stakeholders involved.
A significant simplification of due diligence duties for businesses and a more
efficient transparency framework would involve a streamlining of the processes
companies need to follow to ensure compliance. By reducing these obligations,
businesses will face lower compliance costs, enabling more resources to be allocated
to core business activities.
1.5.2. Added value of EU involvement (it may result from different factors, e.g.
coordination gains, legal certainty, greater effectiveness or complementarities). For
the purposes of this section 'added value of EU involvement' is the value resulting
from EU action that is additional to the value that would have been otherwise
created by Member States alone.
Reasons for action at EU level (ex-ante):
33
As referred to in Article 58(2), point (a) or (b) of the Financial Regulation.
EN 5 EN
Securitisation products are part of EU capital markets which are open and integrated.
Securitisation links financial institutions from different Member States and non-
Member States: often banks originate the loans that are securitised, while financial
institutions such as insurers and investment funds invest in these products and they
do so across European borders.
Securitisation is a tool to deepen EU capital markets, to diversify their risk profile
and to free up banks’ balance sheet for additional lending, for EU households and
businesses, to make the EU economy more competitive and resilient.
The ability of Member States to adopt national measures is limited, given that the
existing EU securitisation framework, already provides for a harmonised set of rules
at EU level and that changes at national level would conflict with Union law
currently in force. Individual Member State action cannot by itself attain the
objectives outlined above.
Expected generated EU added value (ex-post):
The proposal aims to aims to remove undue issuance and investment barriers in the
EU securitisation market and will deliver a level playing field in the internal market
for all institutional investors and entities involved in securitisation.
1.5.3. Lessons learned from similar experiences in the past
The evaluation and impact assessment accompanying the legislative proposal have
assessed how the existing framework has performed and identify a few
shortcomings. The general objective “to revive a safer securitisation market that will
improve the financing of the EU economy, weakening the link between banks’
deleveraging needs and credit tightening in the short run, and creating a more
balanced and stable funding structure of the EU economy in the long run” has been
only partially achieved because, while the securitisation market is safer, the initiative
has not been sufficient to revive the market or improve financing opportunities. Most
of the measures that were introduced in the framework aimed first and foremost to
mitigate potential risks associated with securitisation, rather than support market
development. Going forward, the objective is to strike a better balance between
safety and market development. For this reason, most of the proposed changes focus
on developing further the EU securitisation market by making the framework more
proportionate.
1.5.4. Compatibility with the multiannual financial framework and possible synergies with
other appropriate instruments
The objectives of the initiative are consistent with a number of other EU policies and
ongoing initiatives, in particular with the Union policies aimed at creating Savings
and Investments Union. In its March 2025 Communication on Savings and
Investments Union, the European Commission announced adoption of measures
focusing on simplifying due diligence and transparency to further boost securitisation
market.
The legislative proposal would remain compatible with the MFF with limited
budgetary impacts as it foresees additional Union contribution to European Banking
Authority (EBA) stemming from the additional 2 FTEs that the EBA would receive
to implement additional tasks conferred by the legislators.
Synergies and room for redeployment were examined, resulting in one FTE who
would be transferred from ESMA to the EBA to reflect the transfer of a task between
EN 6 EN
the authorities. The FTE transferred from ESMA would have no significant
budgetary impacts except for a transfer within Heading 1.
Altogether, the proposal will increase of 3 more FTEs the authorised staff of the
EBA during the future annual budgetary procedure, including 1 FTE transferred from
ESMA. The EBA will continue to work towards maximising synergies and
efficiency gains (inter alia via IT systems), and closely monitor the additional
workload associated with this proposal, which would be reflected in the level of
authorised staff requested by the agency in the annual budgetary procedure.
1.5.5. Assessment of the different available financing options, including scope for
redeployment
Different financing options were discussed, including in particular covering the costs
by fees and internal redeployment. The fee option is practically unworkable as fees
levied on firms would not be able to cover the costs of the proposals. Such an
approach would also be difficult to justify, as the considered measures are not
directly linked to supervisory powers, but part of developing the regulatory
framework.
Potential for redeployment was examined, resulting in the transfer of 1 temporary
agent from ESMA to the EBA. Further internal redeployment within the ESAs is not
an option, given that ESAs already struggle significantly to deliver on their
regulatory tasks.
EN 7 EN
1.6. Duration of the proposal/initiative and of its financial impact
 limited duration
–  in effect from [DD/MM]YYYY to [DD/MM]YYYY
–  financial impact from YYYY to YYYY for commitment appropriations and
from YYYY to YYYY for payment appropriations.
 unlimited duration
– Implementation with a start-up period from 2027 to 2029,
– followed by full-scale operation.
1.7. Method(s) of budget implementation planned34
 Direct management by the Commission
–  by its departments, including by its staff in the Union delegations;
–  by the executive agencies
 Shared management with the Member States
 Indirect management by entrusting budget implementation tasks to:
–  third countries or the bodies they have designated
–  international organisations and their agencies (to be specified)
–  the European Investment Bank and the European Investment Fund
–  bodies referred to in Articles 70 and 71 of the Financial Regulation
–  public law bodies
–  bodies governed by private law with a public service mission to the extent that
they are provided with adequate financial guarantees
–  bodies governed by the private law of a Member State that are entrusted with
the implementation of a public-private partnership and that are provided with
adequate financial guarantees
–  bodies or persons entrusted with the implementation of specific actions in the
common foreign and security policy pursuant to Title V of the Treaty on
European Union, and identified in the relevant basic act
– bodies established in a Member State, governed by the private law of a
Member State or Union law and eligible to be entrusted, in accordance with
sector-specific rules, with the implementation of Union funds or budgetary
guarantees, to the extent that such bodies are controlled by public law bodies or
by bodies governed by private law with a public service mission, and are provided
with adequate financial guarantees in the form of joint and several liability by the
controlling bodies or equivalent financial guarantees and which may be, for each
action, limited to the maximum amount of the Union support.
Comments
34
Details of budget implementation methods and references to the Financial Regulation may be found on
the BUDGpedia site: https://myintracomm.ec.europa.eu/corp/budget/financial-rules/budget-
implementation/Pages/implementation-methods.aspx.
EN 8 EN
N/A
EN 9 EN
2. MANAGEMENT MEASURES
2.1. Monitoring and reporting rules
In line with standard arrangements practiced in existing agencies, the European
Banking Authority (EBA) will prepare regular reports on its activity (including
internal reporting to Senior Management, reporting to Boards and the production of
the annual report), and will be subject to audits by the Court of Auditors and the
Commission's Internal Audit Service on its use of resources and performance.
The EBA Regulation (EU) No 1093/2010 is subject to regular reviews.
2.2. Management and control system(s)
2.2.1. Justification of the budget implementation method(s), the funding implementation
mechanism(s), the payment modalities and the control strategy proposed
The European Supervisory Agencies for financial services (EBA, EIOPA, ESMA),
are decentralised regulatory agencies pursuant to Art. 70 Financial Regulation.
Management and control systems of the European Banking Authority are provided
for in Chapter VI of Regulation (EU) No 1093/2010 establishing it, in combination
with the applicable framework financial Regulation (EU) 2019/715 as endorsed by
the Authority.
The Authority must ensure that the appropriate standards are met in all areas of the
internal control framework and is subject to audits by the Commission’s Internal
Audit Service. In addition, every financial year, the European Parliament, following
a recommendation from the Council, grants discharge to this agency for the
implementation of its budget.
2.2.2. Information concerning the risks identified and the internal control system(s) set up
to mitigate them
In relation to the legal, economic, efficient and effective use of appropriations
resulting from the actions to be carried out in the context of this proposal by the
EBA, this initiative does not bring about new significant risks that would not be
covered by an existing internal control framework.
2.2.3. Estimation and justification of the cost-effectiveness of the controls (ratio between
the control costs and the value of the related funds managed), and assessment of the
expected levels of risk of error (at payment & at closure)
Management and control systems are provided in the Regulation (EU) 1093/2010
which governs the functioning of the EBA. These are deemed to be cost effective.
The initiative will have no significant effect on costs to be supported by those of the
Member States or the EBA from that angle. Impacts on risks of error rates are
expected to be very low.
Historically DG FISMA’s costs of the overall supervision of an Authority such as the
EBA have been estimated at 0.5% of the annual contributions paid to it. Such costs
include, for example but not exclusively, the costs related to the assessment of the
annual programming and budget, the participation of DG FISMA's representatives in
Management Boards, Boards of Supervisors and related preparatory work.
EN 10 EN
2.3. Measures to prevent fraud and irregularities
For the purposes of combating fraud, corruption and any other illegal activity, the
provisions of Regulation (EC) No 1073/1999 of the European Parliament and of the
Council of 25 May 1999 concerning investigations conducted by the European Anti-
Fraud Office (OLAF) applies to EBA without any restrictions.
EN 11 EN
3. ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE
3.1. Heading(s) of the multiannual financial framework and expenditure budget
line(s) affected
• Existing budget lines
In order of multiannual financial framework headings and budget lines.
Heading of
multiannual
financial
framework
Budget line
Type of
expenditure
Contribution
Number Diff./Non-
diff.35
from
EFTA
countries
36
from
candidate
countries
and
potential
candidates
37
From
other
third
countries
other assigned
revenue
1.
03 10 02 00: European Banking Authority
(EBA) Diff. NO NO NO NO
1. 03 10 04 00: European Securities and
Markets Auhority (ESMA)
Diff. NO NO NO NO
• New budget lines requested
In order of multiannual financial framework headings and budget lines.
Heading of
multiannual
financial
framework
Budget line
Type of
expenditure
Contribution
Number Diff./Non-
diff.
from
EFTA
countries
from
candidate
countries
and
potential
candidates
from
other
third
countries
other assigned
revenue
N/A
35
Diff. = Differentiated appropriations / Non-diff. = Non-differentiated appropriations.
36
EFTA: European Free Trade Association.
37
Candidate countries and, where applicable, potential candidates from the Western Balkans.
EN 12 EN
3.2. Estimated financial impact of the proposal on appropriations
3.2.1. Summary of estimated impact on operational appropriations
–  The proposal/initiative does not require the use of operational appropriations
–  The proposal/initiative requires the use of operational appropriations, as explained below
3.2.1.1. Appropriations from voted budget
EUR million (to three decimal places)
Heading of multiannual financial framework Number
DG: <…….>
Year Year Year Year TOTAL MFF
2021-2027
2024 2025 2026 2027
Operational appropriations
Budget line
Commitments (1a) 0.000
Payments (2a) 0.000
Budget line
Commitments (1b) 0.000
Payments (2b) 0.000
Appropriations of an administrative nature financed from the envelope of specific programmes38
Budget line (3) 0.000
TOTAL appropriations
for DG <…….>
Commitments =1a+1b+3 0.000 0.000 0.000 0.000 0.000
Payments =2a+2b+3 0.000 0.000 0.000 0.000 0.000
European Banking Authority Year Year Year Year
TOTAL MFF
2021-2027
38
Technical and/or administrative assistance and expenditure in support of the implementation of EU programmes and/or actions (former ‘BA’ lines), indirect research, direct research.
EN 13 EN
2024 2025 2026 2027
Budget line: 03 10 02 002 / EU Budget contribution to the agency 0.263 0.263
The Union subsidy to ESMA will be reduced by the amounts shown in the table below:
European Securities and Markets Authority
Year
2024
Year
2025
Year
2026
Year
2027
TOTAL MFF
2021-2027
Budget line: 03 10 04 00 / EU Budget contribution to the agency (0.088) (0.088)
The appropriations and EU budget contribution to the European Banking Authority (EBA) will be compensated in part by a reduction
of the appropriations and EU budget contribution to the European Securities and Markets Authority (ESMA) – resulting in the net
amounts shown in the tables below.
Year Year Year Year TOTAL MFF
2021-2027
2024 2025 2026 2027
TOTAL operational appropriations
(including contribution to decentralised
agency)
Commitments (4) 0.000 0.000 0.000 0.175 0.175
Payments (5) 0.000 0.000 0.000 0.175 0.175
TOTAL appropriations of an administrative nature financed
from the envelope for specific programmes
(6) 0.000 0.000 0.000 0.000 0.000
TOTAL appropriations under
HEADING 1
Commitments =4+6 0.000 0.000 0.000 0.175 0.175
of the multiannual financial framework Payments =5+6 0.000 0.000 0.000 0175 0.175
Year Year Year Year TOTAL
MFF2021-
2027
2024 2025 2026 2027
EN 14 EN
• TOTAL operational appropriations (all
operational headings)
Commitments (4) 0.000 0.000 0.000 0.175 0.175
Payments (5) 0.000 0.000 0.000 0.175 0.175
• TOTAL appropriations of an administrative nature financed
from the envelope for specific programmes (all operational
headings)
(6) 0.000 0.000 0.000 0.000 0.000
TOTAL appropriations under Headings 1
to 6
Commitments =4+6 0.000 0.000 0.000 0.175 0.175
of the multiannual financial framework
(Reference amount)
Payments =5+6 0.000 0.000 0.000 0175 0.175
Heading of multiannual financial framework 7 ‘Administrative expenditure’39
DG: <…….>
Year Year Year Year TOTAL
MFF 2021-
2027
2024 2025 2026 2027
 Human resources 0.000 0.000 0.000 0.000 0.000
 Other administrative expenditure 0.000 0.000 0.000 0.000 0.000
TOTAL DG <…….> Appropriations 0.000 0.000 0.000 0.000 0.000
DG: <…….>
Year Year Year Year TOTAL
MFF
2021-2027
2024 2025 2026 2027
 Human resources 0.000 0.000 0.000 0.000 0.000
 Other administrative expenditure 0.000 0.000 0.000 0.000 0.000
TOTAL DG <…….> Appropriations 0.000 0.000 0.000 0.000 0.000
39
The necessary appropriations should be determined using the annual average cost figures available on the appropriate BUDGpedia webpage.
EN 15 EN
TOTAL appropriations under HEADING 7 of the multiannual financial
framework
(Total
commitments
= Total
payments)
0.000 0.000 0.000 0.000 0.000
EUR million (to three decimal places)
Year Year Year Year TOTAL MFF
2021-2027
2024 2025 2026 2027
TOTAL appropriations under HEADINGS 1 to 7 Commitments 0.000 0.000 0.000 0.175 0.175
of the multiannual financial framework Payments 0.000 0.000 0.000 0.175 0.175
3.2.1.2. Appropriations from external assigned revenues
EUR million (to three decimal places)
Heading of multiannual financial framework Number
DG: <…….>
Year Year Year Year TOTAL MFF
2021-2027
2024 2025 2026 2027
Operational appropriations
Budget line
Commitments (1a) 0.000
Payments (2a) 0.000
Budget line
Commitments (1b) 0.000
Payments (2b) 0.000
EN 16 EN
Appropriations of an administrative nature financed from the envelope of specific programmes40
Budget line (3) 0.000
TOTAL appropriations
for DG <…….>
Commitments =1a+1b+3 0.000 0.000 0.000 0.000 0.000
Payments =2a+2b+3 0.000 0.000 0.000 0.000 0.000
3.2.2. Estimated output funded from operational appropriations
Commitment appropriations in EUR million (to three decimal places)
Indicate
objectives and
outputs

Year
2024
Year
2025
Year
2026
Year
2027
Enter as many years as necessary to show the
duration of the impact (see Section 1.6)
TOTAL
OUTPUTS
Type41 Avera
ge
cost
No Cost
No
Cost
No
Cost
No
Cost
No
Cost
No
Cost
No
Cost
Total
No
Total
cost
SPECIFIC OBJECTIVE No 142
…
- Output
- Output
- Output
Subtotal for specific objective No 1
SPECIFIC OBJECTIVE No 2 ...
- Output
Subtotal for specific objective No 2
40
Technical and/or administrative assistance and expenditure in support of the implementation of EU programmes and/or actions (former ‘BA’ lines), indirect research, direct research.
41
Outputs are products and services to be supplied (e.g.: number of student exchanges financed, number of km of roads built, etc.).
42
As described in Section 1.3.2. ‘Specific objective(s)’
EN 17 EN
TOTALS
EN 18 EN
3.2.3. Summary of estimated impact on administrative appropriations
–  The proposal/initiative does not require the use of appropriations of an
administrative nature
–  The proposal/initiative requires the use of appropriations of an administrative
nature, as explained below
3.2.3.1. Appropriations from voted budget
VOTED APPROPRIATIONS
Year Year Year Year TOTAL
2021 - 2027
2024 2025 2026 2027
HEADING 7
Human resources 0.000 0.000 0.000 0.000 0.000
Other administrative expenditure 0.000 0.000 0.000 0.000 0.000
Subtotal HEADING 7 0.000 0.000 0.000 0.000 0.000
Outside HEADING 7
Human resources 0.000 0.000 0.000 0.000 0.000
Other expenditure of an administrative nature 0.000 0.000 0.000 0.000 0.000
Subtotal outside HEADING 7 0.000 0.000 0.000 0.000 0.000
TOTAL 0.000 0.000 0.000 0.000 0.000
3.2.4. Estimated requirements of human resources
–  The proposal/initiative does not require the use of human resources
–  The proposal/initiative requires the use of human resources, as explained
below
3.2.4.1. Financed from voted budget
Estimate to be expressed in full-time equivalent units (FTEs)43
VOTED APPROPRIATIONS
Year Year Year Year
2024 2025 2026 2027
 Establishment plan posts (officials and temporary staff)
20 01 02 01 (Headquarters and Commission’s Representation Offices) 0 0 0 0
20 01 02 03 (EU Delegations) 0 0 0 0
01 01 01 01 (Indirect research) 0 0 0 0
01 01 01 11 (Direct research) 0 0 0 0
Other budget lines (specify) 0 0 0 0
• External staff (in FTEs)
20 02 01 (AC, END from the ‘global envelope’) 0 0 0 0
20 02 03 (AC, AL, END and JPD in the EU Delegations) 0 0 0 0
Admin. Support
line
[XX.01.YY.YY]
- at Headquarters 0 0 0 0
- in EU Delegations 0 0 0 0
01 01 01 02 (AC, END - Indirect research) 0 0 0 0
43
Please specify below the table how many FTEs within the number indicated are already assigned to the
management of the action and/or can be redeployed within your DG and what are your net needs.
EN 19 EN
01 01 01 12 (AC, END - Direct research) 0 0 0 0
Other budget lines (specify) - Heading 7 0 0 0 0
Other budget lines (specify) - Outside Heading 7 0 0 0 0
TOTAL 0 0 0 0
The staff required to implement the proposal (in FTEs):
Current staff
available in the
Commission
services
Additional staff*
To be financed
under Heading
7 or Research
To be financed
from BA line
To be financed
from fees
Establishment plan
posts
N/A
External staff (CA,
SNEs, INT)
Description of tasks to be carried out by:
Officials and temporary staff
External staff
3.2.5. Overview of estimated impact on digital technology-related investments
Compulsory: the best estimate of the digital technology-related investments entailed
by the proposal/initiative should be included in the table below.
Exceptionally, when required for the implementation of the proposal/initiative, the
appropriations under Heading 7 should be presented in the designated line.
The appropriations under Headings 1-6 should be reflected as “Policy IT expenditure
on operational programmes”. This expenditure refers to the operational budget to be
used to re-use/ buy/ develop IT platforms/tools directly linked to the implementation
of the initiative and their associated investments (e.g. licences, studies, data storage
etc). The information provided in this table should be consistent with details
presented under Section 4 “Digital dimensions”.
TOTAL Digital and IT appropriations
Year Year Year Year TOTAL
MFF
2021 -
2027
2024 2025 2026 2027
HEADING 7
IT expenditure (corporate) 0.000 0.000 0.000 0.000 0.000
Subtotal HEADING 7 0.000 0.000 0.000 0.000 0.000
Outside HEADING 7
Policy IT expenditure on operational
programmes
0.000 0.000 0.000 0.000 0.000
EN 20 EN
Subtotal outside HEADING 7 0.000 0.000 0.000 0.000 0.000
TOTAL 0.000 0.000 0.000 0.000 0.000
3.2.6. Compatibility with the current multiannual financial framework
The proposal/initiative:
–  can be fully financed through redeployment within the relevant heading of the
multiannual financial framework (MFF)
Not applicable as the tasks would be undertaken by decentralised agencies.
–  requires use of the unallocated margin under the relevant heading of the MFF
and/or use of the special instruments as defined in the MFF Regulation
Not applicable as the tasks would be undertaken by decentralised agencies.
–  requires a revision of the MFF
Not applicable as the tasks would be undertaken by decentralised agencies.
3.2.7. Third-party contributions
The proposal/initiative:
–  does not provide for co-financing by third parties
–  provides for the co-financing by third parties estimated below:
Appropriations in EUR million (to three decimal places)
Year 2024 Year 2025 Year 2026 Year 2027 Total
Specify the co-financing body
TOTAL appropriations co-
financed
3.2.8. Estimated human resources and the use of appropriations required in a decentralised
agency
Staff requirements (fulll-time equivalent units)
Agency: European Banking Authority Year 2024 Year 2025 Year 2026 Year 2027
Temporary agents (AD Grades) 3
Temporary agents (AST grades)
Temporary agents (AD+AST) subtotal 0 0 0 3
Contract agents
Seconded national experts
EN 21 EN
Contract agents and seconded national
experts subtotal
0 0 0 0
TOTAL staff 0 0 0 3
Agency: European Securities and
Markets Authority
Year 2024 Year 2025 Year 2026 Year 2027
Temporary agents (AD Grades) (1)
Temporary agents (AST grades)
Temporary agents (AD+AST) subtotal 0 0 0 (1)
Contract agents
Seconded national experts
Contract agents and seconded national
experts subtotal
0 0 0 0
TOTAL staff 0 0 0 (1)
Appropriations covered by the EU budget contribution in EUR million (to three decimal places)
Agency: European Banking Authority Year 2024 Year 2025 Year 2026 Year 2027
TOTAL
2021 - 2027
Title 1: Staff expenditure 0.225 0.225
Title 2: Infrastructure and operating
expenditure
0.037 0.037
Title 3: Operational expenditure 0.000
TOTAL of appropriations covered by
the EU budget
0.000 0.000 0.000 0.263 0.263
Agency: European Securities and
Markets Authority
Year 2024 Year 2025 Year 2026 Year 2027
TOTAL
2021 - 2027
Title 1: Staff expenditure (0.075) (0.075)
Title 2: Infrastructure and operating
expenditure
(0.013) (0.013)
Title 3: Operational expenditure 0.000
EN 22 EN
TOTAL of appropriations covered by
the EU budget
0.000 0.000 0.000 (0.088) (0.088)
Appropriations covered by fees, if applicable, in EUR million (to three decimal places)
N/A
Appropriations covered by co-financing, if applicable, in EUR million (to three decimal places)
Contribution by national competent authorities to the European Banking Authority will be
compensated in part by a reduction of contributions by national competent authorities to the
European Securities and Markets Authority.
Agency: European Banking Authority Year 2024 Year 2025 Year 2026 Year 2027
TOTAL
2021 - 2027
Title 1: Staff expenditure 0.338 0.338
Title 2: Infrastructure and operating
expenditure
0.056 0.056
Title 3: Operational expenditure 0.000
TOTAL of appropriations covered by
the EU budget
0.000 0.000 0.000 0.394 0.394
Contributions by national competent authorities to ESMA will be reduced by the amounts
shown in the table below, corresponding to 1 FTE:
Agency: European Securities and
Markets Authority
Year 2024 Year 2025 Year 2026 Year 2027
TOTAL
2021 - 2027
Title 1: Staff expenditure (0.112) (0.112)
Title 2: Infrastructure and operating
expenditure
(0.019) (0.019)
Title 3: Operational expenditure 0.000
TOTAL of appropriations covered by
the EU budget
0.000 0.000 0.000 (0.131) (0.131)
Overview/summary of human resources and appropriations (in EUR million) required by the
proposal/initiative in a decentralised agency
The subsidy of the Union and contribution by national competent authorities to the European
Banking Authority will be compensated in part by a reduction of subsidy and contribution to
the European Securities and Markets Authority.
EN 23 EN
Agency: European Banking Authority Year 2024 Year 2025 Year 2026 Year 2027
TOTAL
2021 - 2027
Temporary agents (AD+AST) 0 0 0 3 -
Contract agents 0 0 0 0 -
Seconded national experts 0 0 0 0 -
Total staff 0 0 0 3 -
Appropriations covered by the EU budget 0.000 0.000 0.000 0.263 0.263
Appropriations covered by fees
(if applicable)
0.000 0.000 0.000 0.000 0.000
Appropriations co-financed
(if applicable)
0.000 0.000 0.000 0.394 0.394
TOTAL appropriations 0.000 0.000 0.000 0.657 0.657
The headcount of ESMA will be reduced by 1 FTE, allowing for a reduction of the subsidy of
the Union and contribution by national competent authorities to ESMA, as shown in the table
below:
Agency: European Securities and
Markets Authority
Year 2024 Year 2025 Year 2026 Year 2027
TOTAL
2021 - 2027
Temporary agents (AD+AST) 0 0 0 (1) -
Contract agents 0 0 0 0 -
Seconded national experts 0 0 0 0 -
Total staff 0 0 0 (1) -
Appropriations covered by the EU budget 0.000 0.000 0.000 (0.088) (0.088)
Appropriations covered by fees
(if applicable)
0.000 0.000 0.000 0.000 0.000
Appropriations co-financed
(if applicable)
0.000 0.000 0.000 (0.131) (0.131)
TOTAL appropriations 0.000 0.000 0.000 (0.219) (0.219)
EN 24 EN
3.3. Estimated impact on revenue
–  The proposal/initiative has no financial impact on revenue.
–  The proposal/initiative has the following financial impact:
–  on own resources
–  on other revenue
–  please indicate, if the revenue is assigned to expenditure lines
EUR million (to three decimal places)
Budget revenue line:
Appropriations
available for the
current financial
year
Impact of the proposal/initiative44
Year 2024 Year 2025 Year 2026 Year 2027
Article ………….
For assigned revenue, specify the budget expenditure line(s) affected.
Other remarks (e.g. method/formula used for calculating the impact on revenue or
any other information).
4. DIGITAL DIMENSIONS
The proposed amendments to Regulation (EU) 2017/2402 do not substantially modify
the digital infrastructure and processes that support the implementation of the
Regulation. Consequently, the proposal is considered of no digital relevance.
4.1. Requirements of digital relevance
Not applicable
4.2. Data
Not applicable
4.3. Digital solutions
4.4. Interoperability assessment
44
As regards traditional own resources (customs duties, sugar levies), the amounts indicated must be net
amounts, i.e. gross amounts after deduction of 20 % for collection costs.
Not applicable
Not applicable
EN 25 EN
4.5. Measures to support digital implementation
Not applicable