Securitization: The Road Ahead

Abstract

Authorized for distribution by José Viñals DISCLAIMER: This Staff Discussion Note represents the views of the authors and does not necessarily represent IMF views or IMF policy. The views expressed herein should be attributed to the authors and not to the IMF, its Executive Board, or its management. Staff Discussion Notes are published to elicit comments and to further debate.

Mortgage‐backed Securitization and SME Lending During the Financial and Economic Crisis: Evidence from the Italian Cooperative Banking System

“…In Europe, from 1999 to 2014, the total issuance of residential (RMBSs) and commercial (CMBSs) mortgage-backed securities has represented an average of 61 per cent (RMBSs: 54 per cent; CMBSs: 7 per cent) of securitization issuance (Segoviano et al, 2015). Since the 2007 onset of the financial crisis, total European securitization issuance has declined by more than 40 per cent of the 1999-2014 average, and much of that issuance has been retained by the originators for the primary purpose of using it as collateral with the European Central Bank (ECB).…”

“…Most notably, the annual average share of ABSs pledged as collateral with the ECB rose to 28 per cent during 2008, up from 11 per cent in 2006 and only 6 per cent in 2004(Cheun et al, 2009. The large drop in securitization issuance coupled with the European banks' deleveraging process led to a credit crunch that had a particularly strong effect on SMEs (Segoviano et al, 2015).…”