Sustainable Securitisation – too complicated or worth the effort?

“It’s NOT simple” has been the reaction of many securitisation market participants when the Securitisation Regulation introduced the concept of “Simple, Transparent and Standardised” (“STS”) securitisations back in early 2019. With the emergence of sustainable securitisations, things are again not quite as straightforward as one would wish. During its young history, the regulatory environment for sustainable securitisations has already gone through several evolutions. But despite all the complications, this development holds opportunities for the much-needed growth of the European securitisation market and the financing of the sustainable transformation of the European economy, argue Michael Osswald (Managing Director, SVI) and Christian Fahrholz (Director, TSI).

Regulatory evolution

Both securitisations and sustainable finance are at the heart of the European Commission’s Action Plan on Capital Markets Union, even in its original version which dates back to 2015 (TSI kompakt vom 4. Februar 2015 „EU-Kapitalmarktunion nimmt langsam Fahrt auf„). Sustainable finance gained particular momentum in the aftermath of the launch of the European Green Deal by the European Commission in 2019. This is because one of the objectives of the European Green Deal is to mobilise at least €1 trillion in sustainable investments over the next decade and to channel private investment towards the transition to a climate-neutral economy.

You can read the full article, which is the second in a series of three in a cooperation of Wolf Theiss, TSI and SVI right here:

Sustainable Securitisation – too complicated or worth the effort?

You will find the first article under TSI Fachnews „The European Green Bond Standard – Gold standard for green bonds or regulatory burden?“ The series will conclude with interviews with leading bank and securitisation market experts who will give their view on practical aspects issuing Green bonds and sustainable securitisations. Watch this space in January 2023 for „Green Bonds and Securitisation – the market participants‘ view“.