CP26/6: Rules for reforming the UK Securitisation Framework

Read CP26/6 (PDF)[2]

We have closely coordinated with the PRA to ensure a coherent and consistent framework across our rulebooks. See the PRA’s consultation paper[3] with proposals that would affect firms authorised by the PRA.

Why we consulted

Our approach in reforming the securitisation rules aims to simplify and streamline our rules and regulatory approach to eliminate unnecessary costs. At the same time, we aim to maintain high standards that support market integrity, innovation and competition as well as the competitiveness of the UK financial services industry. 

We have done so by:

• Making the securitisation rules more proportionate.
• Reducing barriers to issuing and investing in securitisations.
• Maintaining appropriate protections for investors.
• Providing a clearer framework for market participants.

Our proposals aim to ensure the market can operate with greater confidence and efficiency, reducing legal and operational uncertainty. They also aim to foster a favourable environment for the securitisation market, supporting a resilient financial system and facilitating growth to the real economy.

As part of this consultation, we propose changes to the transparency requirements (see Chapter 4). To help market participants understand these proposals in more detail we provide below the proposed underlying exposures templates. We want to simplify and align the templates more closely to the loan-level templates that the Bank of England requires to be submitted when receiving certain types of collateral in the context of its market operations.  

The templates are marked up against the Bank of England loan-level data templates, where applicable. We also provide additional information to help the comparison to the current FCA Excel files available on the securitisation webpage. 

A marked-up version of the proposed private securitisation notification template is also included for comparison against the current version. These are provided for convenience only; users should also check the requirements in the proposed draft Handbook text (Appendix 1 of the CP).

Annex 2 Underlying exposures - residential real estate[4]
Annex 4A Underlying exposures - CLOs[5]
Annex 5 Underlying exposures - automobile[6]
Annex 6 Underlying exposures - consumer[7]
Annex 8 Underlying exposures - leasing[8]
Annex 10 Underlying exposures - add-on non-performing exposures[9]
PRA/FCA- Private securitisation notification template[10]

Who this is for

This consultation will affect:

• Authorised firms involved in securitisation markets as institutional investors or as manufacturers.
• Unauthorised entities acting as an original lender, originator or SSPE of a securitisation subject to the FCA rules in SECN.
• Individuals holding offices or positions involving responsibility for taking management decisions at firms involved in securitisation markets.
• UK Securitisation Repositories (SRs).

Next steps

This consultation has now closed. 

We will publish feedback on responses and issue a policy statement once we have reviewed your comments.