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Risk retention in securitisations: if not the original lender, who else?

18 March 2024 / Author(s): Mark McGuire
Issue: February 2024 / Categories: Feature

It is almost 15 years since the EU’s risk retention (skin-in-the-game) rules were developed in response to concerns that interests of investors in securitisations and their originators were insufficiently aligned. In that time, the market has developed a number of solutions to adhere to the rules in situations where there may no longer be a substantial entity that was involved in the creation of the underlying exposures to perform the risk retention function.

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