Latest news with #significantrisktransfer
Bloomberg
30-06-2025
- Business
- Bloomberg
EBA Seeks More Clarity on Bank Lending to SRT Buyers
00:00 What is your best estimate of the number of banks and the amount of lending to those entities that are providing those SRTs? Yeah, we have limited information and that's why we flagged this as an area of concern to try to have more, more information. But basically we do know that over 50% of the banks are using significant risk transfers and that they are selling some of these products to the markets. And the expectation from our surveys that three quarters of the banks would continue to do that, that if they want to continue doing that. So that's a market that's been growing, is basically over ,000,000,000,000 market with half of that is significant risk transfers, you know, 500 billion. Now, on the investor side, we do know that the banks are lending to the non-bank financial instrument, to the non-bank financial intermediaries, 10% of the assets of their liabilities because of their assets, because it's lending 10%. You know, we do know who they're lending directly. So I can tell you that there's not a lot of direct link in the sense that, you know, a bank is selling a significant risk transfer product and at the same time is financing the buyer. That's not happening, but it could be another bank that's financing the buyer. Okay. And it could be that the links may come back to the banking sector indirectly, you know, and that's the area that we need to identify more. That's what we've asking for, basically more transparency and more reporting information. And an assessment of the financial shock, what would that mean potentially? What is the potential risk of. Well, potentially a vicious circle by which, you know, a bank could sell protection to somebody that's being financed by another bank. So therefore, it's a bank giving protection to another bank. So therefore, it all remains within the bag. Do you have the tools and mechanisms to be able to get that transparency and get those answers? Not yet. Not yet. And that's what we're pushing, by the way. It's a global problem. It's being involved with the context of the Financial Stability Board as well that has asked for transparency in this area. At the European level, we're working the European systemic risk for to get more information.
Bloomberg
30-05-2025
- Business
- Bloomberg
Santander Unseats Barclays as Europe's Biggest Issuer of SRTs
Banco Santander SA surpassed Barclays Plc as Europe's largest issuer of significant risk transfers, according to S&P Global Ratings. In order to come up with a volume estimate for the privately-negotiated deals, S&P used data on the senior portions that banks retain on their balance sheets and disclose in their regulatory filings. These retained tranches typically represent about 80%-95% of the reference portfolio in European SRTs.
