TITLE VII

PRUDENTIAL SUPERVISION
CHAPTER 2

Review Processes
Section II

Arrangements, processes and mechanisms of institutions
Sub-Section 2

Technical criteria concerning the organisation and treatment of risks

Securitisation risk
Article 82
1
Competent authorities shall ensure that the risks arising from securitisation transactions in relation to which the credit institutions are investor, originator or sponsor, including reputational risks, such as arise in relation to complex structures or products, are evaluated and addressed through appropriate policies and procedures, to ensure that the economic substance of the transaction is fully reflected in the risk assessment and management decisions.
2
Competent authorities shall ensure that liquidity plans to address the implications of both scheduled and early amortisation exist at institutions which are originators of revolving securitisation transactions involving early amortisation provisions.