Sustainable securitisations
Produced in partnership with Chris McGarry, Debashis Dey and Mindy Hauman of White & Case LLP
Sustainable securitisations

The following Banking & Finance guidance note Produced in partnership with Chris McGarry, Debashis Dey and Mindy Hauman of White & Case LLP provides comprehensive and up to date legal information covering:

  • Sustainable securitisations
  • What makes securitisation sustainable?
  • Sustainable CLOs
  • Sustainable ABS
  • Sustainable MBS
  • Ensuring transparency and integrity of collateral
  • Regulatory relief
  • Closing thoughts and future developments

BREXIT: The UK is leaving the EU on Exit Day (as defined in the European Union (Withdrawal) Act 2018). This has an impact on this Practice Note. For guidance, see Practice Note: Brexit—impact on finance transactions—Brexit planning and impact—financial services, Brexit—impact on finance transactions—Key issues for securitisation transactions and Brexit—impact on finance transactions—Derivatives and debt capital markets transactions—key SIs.

The sustainable finance market has experienced exponential growth in certain product areas in the last five years. Annual green bond issuance, for example, passed the US$100bn mark last year and environmental resilience is playing an increasingly important role in investment decisions worldwide. However, US$90tn more in sustainable investment is needed to develop global sustainable infrastructure alone in the next 15 years.

The current rate of market finance will fall considerably short of requirements both in scale and methodology if the status quo remains. One simple but revolutionary solution is the aggregation and leverage of sustainable assets through sustainable securitisation. To ensure this is a viable option, there needs to be a critical mass of sustainable finance assets of various classes available in the market. Sustainable securitisation will simultaneously present institutional investors with the opportunity to invest in sustainable assets and free up bank balance sheets.

Currently, most infrastructure projects are funded by bank loans, though alternative sources of funding are needed as the US$90tn