On 17 June 2025, the European Commission (Commission) published a draft legislative package on the review of the EU’s securitisation framework. Since then, the European Parliament and the Council have been considering the draft legislative proposals. This briefing note provides an update on where things stand now.

Background

The current EU securitisation framework consists of the Securitisation Regulation, which sets out a general framework for all securitisations in the EU and a specific framework for simple, transparent, and standardised (STS) securitisations, as well as prudential requirements for securitisation positions in the Capital Requirements Regulation (CRR) and the Solvency II Delegated Regulation  (Solvency II), and liquidity requirements in the Liquidity Coverage Requirement Delegated Regulation (LCR Delegated Regulation).

Although this framework has improved transparency and standardisation in the EU securitisation market, the Commission still feels that the securitization market has not yet reached its full potential and that the issuance and investment barriers remain too high. To deal with these issues and stimulate the EU securitisation market, the Commission published a draft legislative package consisting of the following, separate proposals:

  • Proposal for a Regulation amending the Securitisation Regulation laying down a general framework for securitisation and creating a specific framework for STS securitisation.
  • Proposal for a Regulation amending the CRR as regards requirements for securitisation exposures.
  • Proposal for a Delegated Regulation amending the LCR Delegated Regulation as regards the eligibility conditions for securitisations in the liquidity buffer of credit institutions.

According to the Commission all of the above initiatives should be considered as a single package, meaning that the future success of the EU securitisation framework depends on all the proposed changes being implemented. That said, only the first two of the above proposals are subject to the legislative procedure. The Delegated Regulation, being amendments to a Level 2 measure, is due to be formally adopted by the Commission, after which the co-legislators have two months to endorse or reject it (without the ability to file amendments).

A detailed overview of the proposed amendments is here.

European Parliament

The European Parliament remains in the initial stages of its decision-making process. The Economic and Monetary Affairs (ECON) Committee appointed Ralf Seekatz (EPP, DE) as rapporteur on the file.

To facilitate discussion, the ECON Committee organised a public hearing on 13 October in order to gather views from stakeholders. Whilst stakeholders generally agreed with the overall aim of the proposals they were divided as whether the proposed amendments would actually revive the EU securitisation market and free up funds for additional lending.

In terms of next steps, the rapporteur, Ralf Seekatz, is planning to publish a draft report containing proposed amendments in December 2025 or January 2026. The draft report will then be discussed in the ECON Committee and shadow rapporteurs and other ECON Committee members will be able to propose their own amendments. Thereafter the ECON Committee is expected to vote on the European Parliament’s position in the beginning of May 2026.

Council

In the Council, discussions are ongoing. The Danish Council Presidency hopes to reach a common position on the draft legislative proposals by the end of this year. While Member States support the overall aim of the Commission’s proposals, they remain divided on certain issues. These include the proposed amendments to the CRR as regards the requirements for securitisation exposures. The Commission proposed introducing a new concept of a risk- sensitive risk weight floor that credit institutions issuing and investing in securitisation must apply to their securitisation exposures. The proposed risk weight floors for senior securitisation positions would be proportionate to the riskiness of the underlying pool of exposures. In addition, the Commission proposed more risk sensitivity in the so-called (p) factor, which is a parameter driving the ‘non-neutrality’ of the securitisation capital requirements for securitisation exposures held by credit institutions, and which is used in the calculation of the securitisation risk weights. Although a majority of Member States are in favour of less strict prudential requirements for securitisation exposures, some are of the opinion that the Commission’s proposals make the framework disproportionately complex.

Outlook

On the basis of the envisaged timelines in the European Parliament and the Council for the adoption of their respective negotiating positions, we expect both co-legislators to be ready to engage into interinstitutional negotiations towards the end of Spring 2026.

This may mean that the European Parliament, Council and Commission will only agree on the final text of the proposals in the second half of 2026.

Thereafter formal adoption and publication of the amending Regulations would not take place until the end of 2026 or the beginning of 2027. The Commission proposed in its June 2025 proposal that the Regulation amending the Securitisation Regulation would enter into force and apply 20 days following its publication in the EU Official Journal.

The discussions in the European Parliament and the Council indicate that the co-legislators are motivated to proceed with amending the EU securitisation framework yet questions remain as to how this should be achieved. In particular, there are concerns that the proposals make the framework more complex for market participants to navigate. In the coming months it will be interesting to see the steps that both the European Parliament and Council will take to prevent this.