August 22, 2026

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The European Post

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August 22, 2026

Newsletter

The European Post

Policy • Diplomacy • Strategic Insight

LATEST
What the EU Taiwan Framework Would Actually Have to DoKorea Signed a Digital Trade Deal That Nobody Has RatifiedCritical Minerals in Mongolia Still Have to Cross Two BordersCan an Indonesia Trade Deal Survive Two Years of RatifyingCross-Border Data Orders Went Live Before the Plumbing DidPlatform Work Rules Take Effect in December and Few Are ReadyCan Europe’s Firefighting Fleet Keep Pace With EU WildfiresThe AI Act Deadline Passed on 2 August and Nothing BitWhy Construction Keeps Shrinking While Confidence ImprovesAccession Talks Stall Again and September 1 Is the TestBrussels Applied a Trade Deal It Cannot Yet RatifyAfrica’s Power Market Now Needs Money More Than BlueprintsLong-Term Budget Talks Enter Autumn Without a Council LineForeign Subsidies Enforcement Now Turns on a Dublin RaidWho Writes Europe’s Telecom Rules Once Copper DisappearsDisability Cards Exist on Paper and Nowhere Else Until 2028Losing Visa-Free Travel Now Takes a Thirty Percent SwingTwenty Flagship Actions Will Test Whether the Culture Compass WorksEurope’s Quality Jobs Act Now Rests on What Unions Do by SeptemberDoes a Three Euro Parcel Duty Change Anything About Cheap ImportsWhat the EU Taiwan Framework Would Actually Have to DoKorea Signed a Digital Trade Deal That Nobody Has RatifiedCritical Minerals in Mongolia Still Have to Cross Two BordersCan an Indonesia Trade Deal Survive Two Years of RatifyingCross-Border Data Orders Went Live Before the Plumbing DidPlatform Work Rules Take Effect in December and Few Are ReadyCan Europe’s Firefighting Fleet Keep Pace With EU WildfiresThe AI Act Deadline Passed on 2 August and Nothing BitWhy Construction Keeps Shrinking While Confidence ImprovesAccession Talks Stall Again and September 1 Is the TestBrussels Applied a Trade Deal It Cannot Yet RatifyAfrica’s Power Market Now Needs Money More Than BlueprintsLong-Term Budget Talks Enter Autumn Without a Council LineForeign Subsidies Enforcement Now Turns on a Dublin RaidWho Writes Europe’s Telecom Rules Once Copper DisappearsDisability Cards Exist on Paper and Nowhere Else Until 2028Losing Visa-Free Travel Now Takes a Thirty Percent SwingTwenty Flagship Actions Will Test Whether the Culture Compass WorksEurope’s Quality Jobs Act Now Rests on What Unions Do by SeptemberDoes a Three Euro Parcel Duty Change Anything About Cheap Imports

Securitisation Reform Enters Trilogues With Ambition Trimmed

Khamzat Chimaev
Brussels Bureau Chief, Financial Services and Banking

Frankfurt: Europe’s securitisation reform reaches trilogue negotiations this autumn with a Parliament mandate that analysts describe as thinner than the draft lawmakers started from. The European Parliament approved its position on the Securitisation Regulation and the Capital Requirements Regulation on 5 May 2026, and talks with the Council and Commission are set for the second half of the year.

The file is the first legislative deliverable of the Savings and Investments Union, the Commission’s attempt to move household savings into capital markets. Its logic is simple. Banks that can package and sell loans free up balance sheet for new lending, and a market that never recovered from 2008 is the constraint.

The Commission’s package amends Regulation (EU) 2017/2402 and the capital rules that sit alongside it. Three changes carry most of the effect:

  • due diligence is simplified, with verification no longer required for EU-based selling parties
  • low-risk exposures guaranteed by multilateral development banks are exempted from due diligence entirely
  • the homogeneity test falls to 70 percent for pools of SME loans, replacing a 100 percent requirement for cross-jurisdiction pools

Finance ministers agreed the Council’s negotiating position on 19 December 2025, adding targeted capital relief for lower-risk transactions. The Council statement framed the deal around reviving a market that shrank while the American equivalent grew.

Revitalising the EU’s securitisation market is a key deliverable of the savings and investments union.

The Parliament’s committee stage went the other way. The economic affairs committee adopted a text that industry analysts read as a weakening of the original rapporteur’s draft, tightening several of the reliefs the Commission proposed and leaving the capital treatment closer to the status quo. That gives negotiators a narrower landing zone than the Council position implies.

Investors have said the current shape will not deliver. Asset managers argue that the charges applied to senior tranches under the existing framework remain punitive relative to the underlying credit risk, and that simplifying due diligence does not touch the number that actually decides whether an insurer or a fund buys the paper.

Banks read the file through their funding costs. Analysts expect significant risk transfer deals to remain the principal use case, with the overhaul shifting the economics at the margin rather than opening a new public issuance channel. That distinction matters for the Savings and Investments Union, which needs retail and institutional money to reach the market, not another instrument traded between banks and specialist funds.

Timing is the second problem. Negotiators do not expect a final deal before the end of 2026, and technical standards and disclosure templates follow after that, which pushes practical application into 2028. The Commission set out its wider capital markets plan in the savings and investments union strategy, and several of its later components assume a functioning market already exists.

The background is a decade of failed repair. The 2017 regulation created the simple, transparent and standardised label to rebuild confidence after the financial crisis, and issuance still sits far below pre-crisis levels while the American market has more than recovered. European supervisors attribute the gap to capital treatment and reporting burden rather than to investor appetite, which is precisely the argument the trilogue now has to settle.

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