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ICMA responds, jointly with the ASF, GFMA and IIF, re BCBS/IOSCO’s Consultative Documents on “Criteria for and capital treatment of simple, transparent and comparable short-term securitisations
5 October 2017 ICMA responded, jointly with the ASF, GFMA and IIF, to the BCBS/IOSCO’s Consultative Documents on criteria for and capital treatment of simple, transparent and comparable (STC) short-term securitisations.

Although the Associations support the Committee’s goal of “assisting the financial industry in its development of STC securitisation structures,” we believe that the mechanisms proposed by the Committee to achieve that goal go too far, risk making the process for obtaining preferential RBC treatment overly complicated, and ignore the strong credit performance over several decades of ABCP conduits (distinct from SIVs and “arbitrage conduits”) backed by “real economy” assets such as trade receivables, auto loans and leases, etc.

We respectfully suggest that our proposals, if adopted, would achieve the Committee’s goal of ensuring that ABCP transactions are structured prudently, justifying less capital, without creating unnecessary and impractical complication that would discourage compliance with the STC criteria and disrupt the operation of the ABCP market.

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