Securitization’s Importance




Trade finance specialist Dirk Coetzer currently serves as managing director for ICON Capital and Firminy Capital. Both of these firms headed by Dirk Coetzer are headquartered in Luxembourg and engage in securitization.

According to a Pricewaterhousecoopers publication, prior to the financial crisis which started in 2008, securitization was the preferred instrument for a large number of issuers and a rapidly growing contributor to the world capital markets. During the financial crisis it reputation was tainted.

When the financial crisis subsided, it was proven that transparent and simple securitization with high-quality assets had defaults that were within expectations. Economists as well as politicians have come to the conclusion that securitization should play a major role in capital markets.

In connection, in February 2015, the European Commission produced its Green Paper on the Capital Markets Union. One of its stated agendas is to establish a plan for high-quality securitization in the European Union, as securitization is viewed as a critical component of properly functioning financial markets.

As the paper states, a standardized, transparent, and simple securitization framework should be established. Securitization that meets these principles will profit from better treatment from regulatory authorities.


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