AI Summary of Article 32 Securitised assets
This document outlines provisions for the exclusion of certain increases in equity from an institution's own funds relating to securitised assets. Specifically, it mandates the exclusion of gains associated with future margin income and net gains from the capitalisation of future income by the originator of a securitisation, which may otherwise enhance credit positions.
The European Banking Authority (EBA) is tasked with developing draft regulatory technical standards to further clarify the concept of a 'gain on sale' by 28 July 2013, with the power to adopt these standards delegated to the Commission as per Regulation (EU) No 1093/2010.
Article 32 Securitised assets
1. An institution shall exclude from any element of own funds any increase in its equity under the applicable accounting framework that results from securitised assets, including the following:
(a) such an increase associated with future margin income that results in a gain on sale for the institution;
(b) where the institution is the originator of a securitisation, net gains that arise from the capitalisation of future income from the securitised assets that provide credit enhancement to positions in the securitisation.
2. EBA shall develop draft regulatory technical standards to specify further the concept of a gain on sale referred to in point (a) of paragraph 1.
EBA shall submit those draft regulatory technical standards to the Commission by 28 July 2013.
Power is delegated to the Commission to adopt the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010.