EBA – Opinion on the use of guarantees as securitisations on the balance sheet

On July 1, the European Banking Authority (EBA) published an opinion addressed to Consob, in response to Consob’s notification regarding the decision to grant authorization pursuant to Article 26-sexies, para. 10, of the Regulation (EU) 2017/2402 on securisations.

Specifically, the authorization aims to use high-quality guarantees for securitizations in balance sheets, in the form of cash deposits held with the originator or its affiliates.
Following the assessment regarding the current classification of Italian credit institutions and the composition of the Italian synthetic securitization market, EBA confirmed that in its opinion the justification for a partial exemption from the regulation is given.

Thus, under certain conditions, the originator can use high-quality guarantees in the form of cash deposits held with the originator.

EBA emphasizes that Consob is still required to conduct periodic checks regarding the existence of exemption conditions and to adopt appropriate measures should these conditions no longer be met.