LegalizeCommission Delegated Regulation (EU) 2019/1851 of 28 May 2019 supplementing Regulation (EU) 2017/2402 of the European Parliament and of the Council with regard to regulatory technical standards on the homogeneity of the underlying exposures in securitisation (Text with EEA relevance)
Article 1
Homogeneity of underlying exposures
For the purposes of Articles 20(8), 24(15), and 26b(8) of Regulation (EU) 2017/2402, underlying exposures shall be deemed to be homogeneous where all of the following conditions are met:
- (a) they correspond to one of the following asset types:
- (i) residential loans that are either secured by one or more mortgages on residential immovable property or that are fully guaranteed by an eligible protection provider among those referred to in Article 201(1) of Regulation (EU) No 575/2013 of the European Parliament and of the Council ([^E0001]) and qualifying for the credit quality step 2 or above as set out in Part Three, Title II, Chapter 2 of that Regulation;
- (ii) commercial loans that are secured by one or more mortgages on commercial immovable property, including offices or other commercial premises;
- (iii) credit facilities provided to individuals for personal, family or household consumption purposes, and credit facilities provided to enterprises where the originator applies the same credit risk assessment approach as for individuals not covered under points (i) and (ii) and points (iv) to (viii);
- (iv) credit facilities, including loans and leases, provided to any type of enterprise or corporation;
- (v) auto loans and leases;
- (vi) credit card receivables;
- (vii) trade receivables;
- (viii) other underlying exposures that are considered by the originator or sponsor to constitute a distinct asset type on the basis of internal methodologies and parameters;
- (b) they are underwritten in accordance with standards that apply similar approaches for assessing associated credit risk;
- (c) they are serviced in accordance with similar procedures for monitoring, collecting and administering cash receivables;
- (d) one or more of the homogeneity factors are applied in accordance with Article 2, where applicable.
For the purposes of point (a) of this Article, where an underlying exposure corresponds to more than one asset type, that exposure shall be assigned to only one asset type in that securitisation.
Any changes to underlying exposures in a pool that is deemed to be homogenous pursuant to this Regulation shall not affect such homogeneity where such changes are due to reasons outside the control of the originator or sponsor.
Article 2
Homogeneity factors
The homogeneity factors for the asset type referred to in Article 1(a)(i) shall be the following:
- (a) ranking of security rights, whereby the pool of underlying exposures consists of only one of the following:
- (i) loans secured by first ranking security rights on a residential immovable property;
- (ii) loans secured by lower and all prior ranking rights on a residential immovable property;
- (iii) loans secured by lower ranking security rights on a residential immovable property;
- (b) type of residential immovable property, whereby the pool consists of only one of the following types:
- (i) income-producing properties;
- (ii) non-income producing properties;
- (c) jurisdiction, whereby the pool consists of exposures secured by residential immovable properties located in the same jurisdiction.
The homogeneity factors for the asset type referred to in Article 1(a)(ii) shall be the following:
- (a) ranking of security rights, whereby the pool consists of only one of the following types of underlying exposures:
- (i) loans secured by first ranking security rights on a commercial immovable property;
- (ii) loans secured by lower and all prior ranking rights on a commercial immovable property;
- (iii) loans secured by lower ranking security rights on a commercial immovable property;
- (b) type of immovable commercial property, whereby the pool consists of only one of the following types:
- (i) office buildings;
- (ii) retail space;
- (iii) hospitals;
- (iv) storage facilities;
- (v) hotels;
- (vi) industrial properties;
- (vii) other specific type of commercial immovable properties;
- (c) jurisdiction, whereby the pool consists of underlying exposures secured by properties located in the same jurisdiction.
The homogeneity factors for the asset type referred to in Article 1(a)(iv) shall be the following:
- (a) type of obligor, whereby the pool consists of only one of the following types of obligors:
- (i) micro-, small- and medium-sized enterprises;
- (ii) other types of enterprises and corporates;
- (b) jurisdiction, whereby the pool consists of only one of the following types of underlying exposures:
- (i) exposures secured by immovable property located in the same jurisdiction;
- (ii) exposures to obligors with residence in the same jurisdiction.
The homogeneity factors for the asset type referred to in Article 1(a)(v) shall be the following:
- (a) type of obligor, whereby the pool consists of underlying exposures with only one of the following types of obligors:
- (i) individuals, and enterprises where the originator applies the same approach for assessing the credit risk associated with exposures to enterprises as for exposures to individuals;
- (ii) micro-, small- and medium-sized enterprises;
- (iii) other types of enterprises and corporates;
- (iv) public sector entities;
- (v) financial institutions;
- (b) jurisdiction, whereby the pool consists of underlying exposures to obligors with residence in the same jurisdiction.
The homogeneity factors for the asset type referred to in Article 1(a)(vi) shall be the following:
- (a) type of obligor, whereby the pool consists of underlying exposures with only one of the following types of obligors:
- (i) individuals, and enterprises where the originator applies the same approach for assessing the credit risk associated with exposures to enterprises as for exposures to individuals;
- (ii) micro-, small- and medium-sized enterprises;
- (iii) other types of enterprises and corporates;
- (iv) public sector entities;
- (v) financial institutions;
- (b) jurisdiction, whereby the pool consists of underlying exposures to obligors with residence in the same jurisdiction.
The homogeneity factors for the asset type referred to in Article 1(a)(viii) shall be any of the following:
- (a) type of obligor;
- (b) ranking of security rights;
- (c) type of immovable property;
- (d) jurisdiction.
Article 3
This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.
This Regulation shall be binding in its entirety and directly applicable in all Member States.
[^E0001]: Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, p. 1).
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