EBA Finalizes Guidelines on Significant Credit Risk Transfer

Summary: On 7 July 2014, the European Banking Authority (EBA) issued its final “Guidelines on Significant Credit Risk Transfer relating to Articles 243 and 244 of Regulation 575/2013” (Guidelines). The Guidelines will be part of the EU Single Rulebook in the banking sector and must be implemented by competent authorities (e.g., the FCA in the UK and BaFin in Germany) within six months of their adoption. The Guidelines’ provisions applicable to competent authorities differ slightly from those applicable to originators, and this alert discusses the underlying substance of the provisions rather than their differences.