On 12 December 2018, the European Banking Authority (EBA) published its final guidelines for the securitisation criteria to be eligible as simple, transparent and standardised (STS) on a cross-sectoral basis throughout the EU.
The EBA consulted on a draft version of the guidelines earlier this year, our blog on which can be found here.
The guidelines consist of two final reports relating to separate types of security:
- final report on guidelines on the STS criteria for non-asset backed commercial paper securitisations; and
- final report on guidelines on the STS criteria for asset-backed commercial paper securitisation.
The guidelines are intended to clarify and ensure a common understanding of all the STS criteria, including those relating to the expertise of the originator and servicer, the underwriting of standards, exposures in default and credit impaired debtors, and predominant reliance on the sale of assets. The guidelines will be applied on a cross-sectoral basis throughout the EU with the aim of facilitating the adoption of the STS criteria.
The guidelines will apply from 15 May 2019 although Member State competent authorities and other addressees may apply them from the application date of the EU securitisation framework on 1 January 2019.