Debate: General framework for securitisation and specific framework for simple, transparent and standardised securitisation to help the recovery from the COVID- crisis – Amending Regulation  No  as regards adjustments to the securitisation framework to support the economic recovery in response to the COVID- crisis
Date: WEDNESDAY, 24 MARCH 2021
Speaker: Mairead McGuinness
Language: EN

I want to thank both rapporteurs for their efforts in bringing this package to a very successful conclusion. This consists of a set of targeted improvements to capital markets and bank legislation that will support the recovery of the economy. In your plenary in February, as you know, Parliament already adopted the changes to markets in financial instruments directive (MiFID) and the Prospectus Regulation that constitutes one half of the package. Today, you were discussing the second half: targeted changes to the EU’s securitisation framework, and amendments to the Securitisation Regulation and to the Capital Requirements Regulation. In tomorrow’s vote, I ask you, honourable Members, to endorse the report by Mr Tang and Mr Karas. The outcome of the negotiations is proportionate and well balanced. It maintains the investor protection and prudential soundness of the current framework. I believe that securitisation within a sound and well-calibrated regulatory framework can play a crucial role in funding the post-crisis recovery. Banks need to be able to continue lending to companies and SMEs in the coming months, once emergency support measures for the economic impact of the crisis are gradually withdrawn.  So it is important to prepare and upgrade tools that allow banks to keep playing this important role. Securitisation can be a key enabler in this respect. By moving risk off the balance-sheet of banks, synthetic securitisation could free up bank capital for new lending and allow a broader range of investors to contribute to the economic recovery. Securitisation could also help banks manage a possible increase in non-performing assets and loans and provide sustainable funding to the economy in a post—pandemic environment. The adjusted prudential treatment of securitisation of banks’ non-performing exposures will be particularly useful in the months to come, given that we can expect non-performing loans to increase as a result of the COVID-19 crisis.  Securitisation is also a key building block of the Capital Markets Union (CMU) and I welcome the support of this House for the CMU in your own—initiative report of last September. By extending the simple, transparent and standardised framework to balance-sheets’ synthetic securitisations, we provide incentives for good practices in that part of the securitisation market, and we help banks find ways to share risk with capital market actors, which is one of the objectives of the capital markets union project. For all these reasons, the agreement you have reached with Council on the capital markets recovery package is an important and timely contribution to the economic recovery. You have demonstrated that Europe can deliver quickly for citizens and businesses, and I’d like to congratulate you for your work and ask for your support for this part of the package in tomorrow’s vote.