Next week, the Structured Finance Association hosts what is surely the world’s biggest securitization jamboree. SFVegas is set to be bigger than ever — with potentially 10,000 people this year, SFA CEO Michael Bright told Another Fine Mezz, when he joined us to record a special episode on February 10.
Sounds stressful to organise. And bankers, too, tell us they've been training hard for three consecutive days of running around the Aria between meetings.
GlobalCapital is a proud to be lead media partner again, and reporters Nick Conforti, Diana Bravo and Oliver West will all be in Vegas for the conference (and may have been eyeing the chair massages available in the hallway on Wednesday morning...).
Be sure to get in touch for a chinwag or say hi if you see us. And of course, check out all of our coverage, which will be in front of the paywall.
Probably no one needed the additional stress of ESMA coming out with a consultation on February 13 that could have acute implications for non-EU originators looking to raise cash from EU investors.
The regulator is in the final stages of a process that started in late 2022, with a report from the European Commission encouraging ESMA to look at easing the hefty burden of disclosure. Last week, ESMA finally put a proposal for a new disclosure template for private deals on the table.
Only, there are a few problems. Not least, the landscape has changed radically since 2022, with the Commission opening up the entire securitization regulatory framework to change. ESMA’s long running project is separate to that work, but it may end up sitting alongside whatever the Commission produces.
What might keep US market participants up at night, however, is that ESMA’s new template would apply only to deals with EU originators.
EU investors have a difficult time investing overseas already, because of the need to obtain the templates. The hope was that ESMA simplifying the templates would reduce the problem. In fact, this proposal might compound it.
It is not uncommon to add originators to deals after they have been agreed. What happens if you want to add a US originator to a deal which previously had only EU originators? It seems like you may have to change the reporting, which would be even more costly than just sticking to the current templates.
It will be interesting to follow the discussion of the issue in Vegas this year.
ESMA's consultation comes as securitization again finds itself being touted as a powerful yet underused tool to fuel European growth, in the context of the new US government having shaken leaders on the old continent into action.
Unsurprisingly, the Vegas schedule is fairly heavy on political content this year — with Bright himself interviewing ex Bush advisor Karl Rove and former Democrat senator Claire McCaskill on Monday morning, among other highlights.
The ESMA consultation is open until March 31, so there will at least be time to review the proposals once the Vegas festivities have concluded.