Significant Risk Transfer (SRT) Chronicles 2025

The bank balance sheet securitisation market has enjoyed significant growth over the past five years and looks set to continue apace on the back of clearer regulation, an increasing number of banks having established an issuance programme and economic incentives for banks to free up risk-weighted assets (‘RWA’) rather than raising capital. 2024 saw record issuance in terms of volumes, number of bank issuers and number of transactions. In this article, we will use significant risk transfer (‘SRT’) – which is the EU regulatory terminology – to denote these securitisations, which are also referred to as balance sheet CLOs, bank risk-sharing transactions or ‘reg cap’ trades.