Browsing by Author "Asoro, Samuel Kayode"

Following the devastating effect of the financial crisis, the securitization in Europe is still largely impaired and yet to get to the pre-crisis level. There are have been many regulatory interventions to revive the securitization market, with the latest being the regulation (EU) 2017/2402 that will be in force by January 2019. This thesis thus critically examines the regulation in the light of its ability to make a difference in European securitization, and possibly preventing another securitization-induced financial crisis. First, the rationale and motivations for securitization are highlighted, and possible drawbacks noted. In the same vein, the positives of having the regulation (EU) 2017/2402 are far reaching. For example, with the regulation coming to force, there is the expectation for more transparency, simplicity and standardization of securitization in Europe. The regulation (EU) 2017/2402, while replacing the laws on securitization in Europe, also creates the general framework for securitization and specific framework for simple, transparent and standardized (STS) securitization. The motivation for European securitizes to get the STS tag is that it makes them eligible for differentiated capital requirement of regulation (EU) 2017/2401. The benefits of the regulation (EU) 2017/2402, however, there are valid concerns about the overall impact on securitization in Europe. This thesis categorizes the concerns to two – sundry concerns and discrepancy concerns. The former relates to the general concerns about the regulation, while the latter expresses the concerns that show differences between what the regulation seeks (as marketed by the authorities), and what is realistically available. The thesis finally concludes on the note that the European securitization market will be greatly impacted by the regulation (EU) 2017/2402 - there will hopefully be a lot of simplicity, transparency, and standardization or comparability, going forward. In addition, parties in securitization transactions now have more clearly defined roles, e.g. investors now have the responsibility of doing their due diligence before and after holding securitization positions, as well as originators and sponsors providing material information about securitization transactions.