Basel Agrees on Criteria and Capital Treatment for Short-Term STC Securitizations

On March 23rd, the Basel Committee on Banking Supervision (BCBS) announced that it has “agreed on a set of criteria and capital treatment for short-term simple, transparent and comparable (STC) securitizations” and that “the accompanying standard will be published in due course.”

SFIG previously submitted a response to the BCBS consultative document: Capital treatment for simple, transparent and comparable (STC) short-term securitisations.

The consultative document on capital sets out additional guidance and requirements for the purpose of applying preferential regulatory capital treatment for banks acting as investors in or as sponsors of STC short-term securitizations, typically in asset-backed commercial paper (ABCP) structures. SFIG's letter focuses on: 1) adopting Alternative Approach 2 for determining compliance with STC criteria, 2) separating the treatment of conduit and transaction-level exposures, and 3) revising short-term STC criteria to accommodate revolving asset pool securitizations.

If you would like to join our ABCP Committee, HQS Task Force or Regulatory Capital & Liquidity Committee, please contact

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