The Eurogroup has tasked the Financial Services Committee (FSC) with identifying concrete steps to advance the Capital Markets Union (CMU) in Europe. With support from key EU institutions, the FSC produced a report focusing on essential areas such as sustainable finance, securitisation, and harmonising financial reporting standards. The report suggests actions to harmonise securitisation standards, improve transparency, and align securitisation frameworks with sustainability goals. However, we believe more emphasis on securitisation’s role is needed to fully realise its potential in enhancing capital velocity, attracting non-bank capital, and providing unique investment opportunities. Additional recommendations include standardising regulatory approvals, developing an “STS 2.0” framework, harmonising regulations for insurance capital, and expanding retail access to securitisation. These steps could significantly strengthen Europe’s financial infrastructure and market resilience.

We are excited to announce that Josefina Frenk and Philip Vasseghi will be joining our team shortly! Josefina brings a wealth of experience in securitisation and the non-performing loans (NPL) markets, with a proven track record in structuring complex transactions across these areas. Josefina joins us from Lowell, where she currently holds the position of Head of Strategic Finance. Prior to this, Josefina worked with securitisations at Nordea. Philip Vasseghi joins from SEB Corporate Finance. His extensive corporate finance experience, alongside his hands-on expertise in the Commercial Real Estate sector, will both support the Group's broader strategic agenda as well as bolster Revel Partners’ execution capacity.

We are delighted to announce that Revel Partners's Jonas Bäcklund and Victor Kloos will be conducting a specialised training session for SRT practitioners on 14 October at the Structured Credit Investor's (SCI's) SRT Week in London.The training session, titled "Balance Sheet Optimisation under Basel 3.1", will focus on the upcoming Basel 3.1 reforms—also known as Basel 3 Endgame or Basel 4—that are set to fundamentally reshape the banking landscape. The most significant impact on capital requirements arises from the implementation of the output floor, which will cap the benefits obtainable from internal models and drive inflation in Risk-Weighted Assets (RWAs).

In its 2024 report, Paris Europlace underscores the critical need to remove regulatory obstacles that have hindered the growth of Europe’s securitisation market. This report builds on the increasing momentum following Mario Draghi’s recent insights, which emphasized securitisation as essential for unlocking capital and improving risk-sharing, both vital for the success of the Capital Markets Union (CMU). Draghi’s report stresses that a robust securitisation market is crucial to sustaining Europe’s economic growth and financial stability.

"Streamlining Europe's SRT Market: A Call for Simplification" In a recent interview with Structured Credit Investor, our CEO, Jonas Bäcklund, discussed the need for regulatory reform in the European Significant Risk Transfer (SRT) market. Despite being a leader in synthetic SRT, Europe’s growth is stunted by complex regulations. Bäcklund backs Mario Draghi’s vision for a revitalised securitisation market to fund long-term projects and the green transition. However, he notes that the 400-page proposal might highlight a key issue with European competitiveness: the need for simplification. By standardising structures and refining risk-weighting rules, we can make securitisation a real growth engine for the European economy.

The PCS Securitisation Symposium in Helsinki highlighted the increasing interest in securitisation across the Nordics, especially for expanding lending capacity and managing non-performing loans (NPLs). With Norway set to implement the EU Securitisation Regulation in 2025, the region is expected to see significant growth in securitisation activity, driven by both banks and non-bank lenders. Growing investor demand and the ability to manage risks, such as maturity mismatch, position securitisation as a key financial tool for the future of Nordic markets.

A recent article in GlobalCapital highlights a significant report from Risk Control that advocates for regulatory reforms to enhance the efficiency of EU securitization, emphasizing its economic benefits. Revel Partners, a leading Nordic advisory firm, has strongly endorsed the report, noting the potential positive impact on Nordic financial markets and the broader European economy. Jonas Bäcklund, CEO of Revel Partners, underscores the importance of these reforms in boosting lending capacity and supporting economic growth, particularly as the EU approaches critical discussions on the future of its securitization regulations.

A recent report by Duponcheele et al. (2024) analyzes the impact of current securitisation regulations on European competitiveness, highlighting the need for adjustments to improve "capital velocity" in banks. The report criticizes the rigid risk-weight (RW) floor, which hampers securitisation activities and limits banks' ability to support economic growth and the green transformation. To close the competitiveness gap with US banks, the report recommends introducing a risk-sensitive RW floor and enhancing governance. Revel Partners supports these findings and stresses the importance of consistent regulation across Europe to reduce uncertainty and unlock the securitisation market's potential, particularly in the Nordics.

In a recent feature in GlobalCapital, Victor Kloos, Director at Revel Partners, shared his expert insights on the burgeoning market for significant risk transfer (SRT) transactions in the Nordic region. Revel Partners has been actively involved in facilitating these transactions, observing a notable increase in activity and interest.

Revel Partners is honored to have been entrusted as sole arranger by Marginalen Bank for Project Argo, a significant risk transfer (SRT) transaction in the form of a cash securitization of cSEK 1 billion in non-performing consumer loans.

As part of our proactive outreach agenda, Revel Partners is thrilled to announce our active participation in the 3rd Annual Nordic Symposium on Securitisation, taking place this September in Helsinki. Our CEO will be delivering a keynote speech on the advancements and future of SRTs (Significant Risk Transfers) and Revel Partners will also be mentoring a pivotal panel discussion on the evolution and future trends of securitisation in the Nordics.

“Everyone expects formal approval this autumn, so I think it is about time for issuers, investors, sponsors and other market participants to start thinking about what Norwegian deals can look like. It takes some time to get from term sheet to closing date, especially for first-time issuers, so there’s no need to wait until the law is finally printed. Interested parties should get started on their homework,”

The private credit market is undergoing significant growth and evolution, driven by structural changes, globalization, and strong investor demand for alternative assets. Structured credit including Significant Risk Transfers (“SRT”) can play crucial roles in this landscape, providing innovative solutions for risk management and investment. The use of implied leverage in these instruments creates space also for smaller and more specialized investors, allowing them to engage in the market alongside larger players. Independent Structuring and Advisory firms have an important role in supporting this development. Overall, several dynamic forces are at play fostering a more inclusive and diverse private credit ecosystem, benefiting the overall market development and offering varied opportunities for all types of investors.

The Association for Financial Markets in Europe (AFME) has published a comprehensive position paper outlining a five-point plan aimed at revitalizing the EU securitisation market. The paper highlights the importance of securitisation in supporting EU growth, addressing regulatory challenges, and maintaining safeguards against high-leverage products. Revel Partners expresses strong support for AFME's conclusions. Revel Partners acknowledges the critical role that securitisation plays in providing capital. liquidity and funding across Europe.

The European synthetic SRT market is booming with increased capital inflow, creating intense competition and tighter pricing. Banks face strategic choices between long-term partnerships and broader market opportunities, amid evolving regulatory landscapes. Success will depend on banks' adaptability and strategic decision-making.

News coverage of Revel Partners and the Nordic SRT market

Revel Partners is launching as an independent Nordic advisor specializing in structured credit solutions. The company aims to enhance capital and financing efficiency for financial sector clients in Northern Europe, leveraging the founders' extensive experience from structured finance. Revel Partners will be part of the Belvere Group and operate out of Stockholm and London.

The European Central Bank (ECB) has released its 2023 data on securitisations, highlighting key trends in the market. The data reveals that banks' outstanding stock of securitisations reached €1.2 trillion. Synthetic transactions dominate the SRT market. Additionally, the volume of non-performing loan securitisations has decreased, reflecting improved loan ratios across the banking sector. The ECB underscores the importance of increasing external investor participation to strengthen Europe’s capital markets.

Christine Lagarde did not only quote poet Ralph Waldo Emerson and philosopher Immanuel Kant, she also underscored the important role of securitisation in a functioninig capital markets union in her speech at the European Banking Congress in Frankfurt.