Sector developments and company hires

Energy-efficiency tax credit ABS debuts
UniCredit has executed the first securitisation of tax credits arising from the Italian ‘Eco-Sisma-SuperEcosisma Bonus’ scheme. Under one of Italy's Covid-recovery laws (the Decreto Rilancio), tax credits accrued in the context of energy-efficiency and/or seismic risk reduction works are allows to be transferred to other entities, such as banks and other financial intermediaries.

The UniCredit transaction enables its corporate clients to enter into a transfer agreement with a securitisation vehicle and then use an innovative platform to finance their assets, by assigning tax credits deriving from their value chain at a pre-agreed price. The structure benefits from the new amendments recently introduced by Law 130/99, which allow investors to participate in securitisations by granting loans to the SPV, with no issuance of ABS.

The first such issuance - totalling €500m - was carried out via EBS Finance, an SPV incorporated under Law 130/99, which will raise the funds needed to pay for the tax credits through loans advanced by UniCredit. The assignors include companies that manufacture products for energy efficiency, such as high-efficiency boilers, heat pumps, photovoltaic systems and thermal coats.

UniCredit Bank acted as arranger on the transaction and Centotrenta Servicing as servicer.

In other news…

EMEA
Raj Shourie has joined Lockton’s political and credit risks division, with responsibility for leading the engagement with financial institutions internationally out of London, for both credit mitigation and country risk protection. Shourie joins Lockton from Aon, where he was the financial institutions advisory lead for credit solutions.

He brings with him over 30 years of experience across capital markets origination, underwriting, risk distribution and loan portfolio management at banks including Barclays, Credit Suisse and Deutsche Bank. Previously, he qualified and practised as a corporate lawyer with Clifford Chance in London and Hong Kong.

At Lockton, Shourie’s primary focus will be on delivering credit mitigation tools for banks seeking to use insurance as a credit risk distribution and capital efficiency tool. These tools range from bilateral and syndicated insurance contracts on unsecured, asset or project-backed loans to bespoke securitisation structures combining insurance with capital markets investors. In addition, Shourie will engage with funds seeking to insure traditional and non-standard risks.

New loan-level data rules activated
The ECB has announced that the ‘ESMA reporting activation date’ occurred on 25 June – after the designation of European DataWarehouse and SecRep as Securitisation Repositories (SCI 29 June) - when all conditions related to the disclosure requirements specified in the Securitisation Regulation were fulfilled. Consequently, the new loan-level data rules will enter into effect after a transitional period of three months from the ESMA reporting activation date.

As of 1 October 2021, ABS under the scope of the Securitisation Regulation will only be assessed for compliance against Eurosystem collateral eligibility criteria if loan-level data is submitted to an ESMA-registered securitisation repository and according to the templates developed by ESMA. All ABS seeking eligibility as Eurosystem collateral are subject to the same loan-level data requirements, regardless of any exemption from the disclosure requirements under the Securitisation Regulation.

For eligible ABS transactions issued prior to 1 January 2019 that are not subject to the Securitisation Regulation, the Eurosystem’s current loan-level data reporting requirements will be maintained for a period of three years until 31 September 2024. After that date, ECB ABS loan-level data templates are phased out and those ABS will be subject to the same procedures, as a Eurosystem eligibility requirement.

Finally, to ensure that non-marketable debt instruments backed by eligible credit claims (DECCs) can comply with their respective loan-level data requirements, the ECB has created a specific ECB SME DECC template. This decision takes the fact that DECCs do not fall under the scope of the Securitisation Regulation into account.

Synthetic STS authorisation for SVI
BaFin has approved STS Verification International’s (SVI) application to expand its authorisation to include the STS verification of synthetic on-balance sheet securitisations. SVI is a third-party verifier, authorised under Article 28 of the Securitisation Regulation since 7 March 2019 to verify securitisation transactions for compliance with the STS) criteria.

Since then, SVI has verified more than 90 transactions in more than 15 countries and is currently working on an additional 20 transactions across all asset classes that are potentially eligible for STS across the EU. Since early 2021, SVI has also been able to perform additional services, including CRR and LCR assessments of STS-compliant transactions.