Securitisation

Securitisation legislation aims to make the securitisation market work more effectively.

We want to make sure that firms operating in the financial markets, and businesses in the real economy, have access to an appropriate range of funding tools, and that disclosure to investors is adequate.

The EU Securitisation Regulation came into effect in the UK on 1 January 2019, and was converted into UK law on 31 December 2020 by the EU (Withdrawal) Act 2018.

Changes to the EU Securitisation Regulation, made by the Securitisation (Amendment) (EU Exit) Regulations 2019, make sure that the onshored legislation (the UK Securitisation Regulation) operates effectively in the UK.

To maintain an accessible pool of STS product for UK institutional investors, EU securitisations notified to the European Securities and Markets Authority (ESMA) as meeting EU STS criteria before and up to 31 December 2024, and which remain on ESMA’s list, will also qualify as UK STS for the life of the transaction.

In December 2022, the Treasury published a Policy Note to explain how it may use powers introduced in the Financial Services and Markets Bill to move to a comprehensive FSMA model for the regulation of securitisation, along with an illustrative draft Statutory Instrument.     

UK Securitisation Regulation

The UK Securitisation Regulation outlines the general requirements for all securitisations, as well as the criteria and process for designating certain securitisations as simple, transparent and standardised (STS).

In addition, onshored changes to the Capital Requirements Regulation (CRR) preserve the more risk-sensitive capital treatment of securitisations for banks and investment firms. This includes methods to calculate risk weights, and preferential treatment for STS securitisations meeting the criteria listed in CRR article 243.

Using our delegated powers, we and the Prudential Regulation Authority (PRA) remedied deficiencies arising from the UK’s withdrawal from the EU in all EU binding technical standards (BTS) that implement the detail of the securitisation legislation and that were in force on 31 December 2020. We and the PRA may make further technical standards.

Implementation of the regulation

We consulted on and issued rules designed to implement the UK Securitisation Regulation:

• 19 December 2018 – Policy Statement (PS18/25)
• 6 June 2019 – Policy Statement (PS19/15)

Disclosure requirements

Technical Standards specifying the information and the details of a securitisation to be made available by the originator, sponsor and securitisation special purpose entity (SSPE) under the UK Securitisation Regulation came into effect on 31 December 2020. See the Technical Standards under the heading of Securitisation Regulation.

UK-formatted spreadsheets that may assist in the reporting of securitisations within the scope of the UK Securitisation Regulation are linked below. These are provided for convenience. Users should always check the requirements of the legislation directly:

• Annex 2: Underlying exposures - residential real estate 
• Annex 3: Underlying exposures - commercial real estate
• Annex 4: Underlying exposures - corporate
• Annex 5: Underlying exposures - automobile
• Annex 6: Underlying exposures - consumer
• Annex 7: Underlying exposures - credit cards 
• Annex 8: Underlying exposures - leasing 
• Annex 9: Underlying exposures - esoteric 
• Annex 10: Underlying exposures - add-on non-performing exposures
• Annex 11: Underlying exposures - ABCP
• Annex 12: Investor report - Non-ABCP securitisation  
• Annex 13: Investor report - ABCP securitisation 
• Annex 14: Inside information or significant event information - Non-ABCP securitisation
• Annex 15: Inside information or significant event information - ABCP securitisation

Securitisation Repositories (SRs)

Originators, sponsors or SSPEs must report public securitisations within the scope of the UK Securitisation Regulation to a UK SR that we register and supervise.

The disclosure XML schemas and validation rules set out below were compatible with both EU and UK templates and were only available until our use of the Temporary Transition Power (TTP) ended on 31 March 2022:

• XML schemas and validation rules v1.3.1 (DRAFT2)

Disclosure XML schemas and validation rules​ for UK templates only and which apply from 1 April 2022 are available below: 

• XML schemas and validation rules v1.3.2 (DRAFT3)

To become a UK SR, firms will need to submit an application to us for registration. Please see our SR page for more details.

Reporting private securitisations

The Securitisation Regulations 2018 grant us and the PRA powers to direct the manner in which the originator, sponsor, or SSPE of a private securitisation established in the UK must make information under article 7(1)(a) to (g) of the UK Securitisation Regulation available to us and the PRA. 

A private securitisation is one where no prospectus must be drawn up. 

On 31 January 2019, we and the PRA issued a final Direction. This Direction may be amended by us or the PRA by further direction. The annex to this Direction includes the templates to be used for notifying us and the PRA of a private securitisation.

Simple, transparent and standardised (STS) securitisations

The framework for STS securitisations is designed to make it easier for investors to understand and assess the risks of a securitisation investment. Positions in STS securitisations can attract preferential capital treatment for firms under CRR. Subject to meeting specified criteria, securitising parties will be able to designate their securitisations as STS.

Although sponsors, originators and securitisation vehicles remain liable for their obligations under the UK Securitisation Regulation, they may – but are not obliged to – use the services of a UK Third Party Verifier (TPV) we authorise to assess compliance of a securitisation with the UK STS criteria. 

Our TPV page has more information on how prospective UK TPVs can apply to be regulated.

STS notifications

The UK Securitisation Regulation requires us to maintain a list of securitisations notified to us as meeting UK STS criteria.

STS list

To qualify as UK STS, the originators and sponsor of a securitisation (or, in the case of ABCP programmes and transactions, the sponsor) must be established in the UK and must notify us, using the onshored UK STS notification templates.

The Securitisation Regulations 2018 grant us the power to direct the manner in which an originator or sponsor of a securitisation established in the UK must inform us of an STS notification. Download the onshored UK STS notification templates and related instructions:

• PUBLIC securitisations
• PRIVATE FULL securitisations
• PRIVATE ANONYMISED securitisations

All STS notifications must be submitted to us via our Connect portal. To submit an STS notification, you will need to login to Connect or register as a new user.

If your firm is already authorised by us, you will need to contact your firm’s Principal User for the appropriate STS access permissions. Once you have permission, click on ‘+ Start an Application’ and you’ll see instructions for submitting your notification under ‘FIRM NOTIFICATIONS’.

If your firm is not authorised, or registered on Connect, click on ‘+ Start an Application’ and navigate to ‘Authorise or Register a new Firm’.

For more help, see our guide on accessing Connect and submitting STS notifications. You can also email queries to [email protected] but please don’t send any UK STS notifications to this address.