European Strategy and Trades

We summarise the main changes to the ECB collateral framework, which show a clear bias towards easing rules for ABS. This could pave the way towards a ABS securitisation platform in the future. On the margin, the collateral changes are positive for risk. We would expect the market to speculate on further LTROs using ABS and SME-loans, especially if EUR front end rates are dragged higher by US Fed tapering.

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