Sector developments and company hires

NPL ABS capital treatment amended
The Basel Committee has published a technical amendment in connection with the capital treatment of non-performing loan securitisations. The rule aims to close a gap in the Basel framework by setting out prudent and risk-sensitive capital requirements for NPL ABS.

The Committee consulted publicly on the technical amendment during the summer (SCI 24 June). But in contrast to the consultative proposal, the final rule permits banks to apply the external ratings-based approach to NPL securitisation exposures, without the 100% risk weight floor. In addition, the final rule includes discounts on tranche sales in the definition of discount incurred by the originating bank that factors in capital requirements.

Committee jurisdictions agreed to implement the technical amendment by no later than January 2023.

In other news…

Global promotions
White & Case has promoted 24 lawyers to counsel and 15 lawyers to local partner, across 22 offices and nine global practices, effective from 1 January 2021. Among the counsel are four lawyers with securitisation-related experience, comprising two in the firm’s global capital markets practice (Nathaniel Crowley and Eric Quiles, based in Hong Kong and Mexico City respectively) and two in its global debt finance practice (Julio Peralta and Nicole Rodger, based in Madrid and Los Angeles respectively).

Sustainable label for ILS fund
Plenum Investments’ catastrophe bond fund, Plenum CAT Bond Fund, has been awarded an FNG Label by the German Forum Nachhaltige Geldanlagen. A key goal of the FNG Label is quality assurance for sustainable mutual funds by establishing and continuously improving quality standards for sustainable investment products. The label concept itself is constantly refined in collaboration with an independent committee.  Plenum says its goal is to help transform the ILS market into a fully ESG-compliant investment universe.