PS24/4: Rules relating to Securitisation

Read PS24/4 (PDF)[1]

Why we are changing

As part of the repeal and replacement of assimilated law (that is, retained European Union law), most firm-facing provisions of the UK Securitisation Regulation (UK SR) will be set out in the FCA and the Prudential Regulation Authority (PRA) rulebooks.

We set out our proposed rules in our Consultation Paper, CP23/17: Rules relating to Securitisation[2].

Our approach was to largely preserve the relevant requirements of the UK SR along with some proposed targeted policy changes.

This Policy Statement outlines:

• feedback received on our proposals and our response
• our final approach to rules in our Handbook

It also includes the final Securitisation Sourcebook (SECN). 

Who this is for

• Authorised firms that are involved in securitisation markets either as institutional investors or as manufacturers
• Unauthorised entities acting as an original lender, originator, or a securitisation special purpose entity (SSPE) of a securitisation subject to the UK SR
• Sellers of securitisation positions to retail clients 
• Individuals holding offices or positions that are responsible for taking management decisions at firms involved in securitisation markets
• Persons applying to be Third Party Verifiers (TPV)
• Securitisation Repositories (SR)

Next steps

The FCA, PRA and the Treasury (for the purposes of the Securitisation Regulations 2024[3]) have decided to implement the FCA and PRA rules on 1 November 2024, subject to the Treasury revoking the UK SR and related technical standards.

This is in response to feedback from some respondents asking for a 6-month period to give market participants more time to prepare before our final rules come into force.

From 1 November 2024, firms will need to make sure you:

• comply with our new requirements
• have updated internal procedures

The FCA and PRA plan to consult on further changes to our securitisation rules in Q4 2024/Q1 2025, although timings may change. 

Background

The UK SR is assimilated law which specifies how securitisation markets are regulated.

Supervisory responsibility for the regulation is currently shared primarily between us and the PRA.

As part of the Treasury’s Smarter Regulatory Framework[4], some provisions of the UK SR will be brought into new UK legislation, and most firm-facing provisions of the UK SR will be covered by new FCA and PRA rules.