Capital Relief Trades

Capital relief trades are deals put together by banks to sell on to investors to reduce the bank's regulatory capital requirements. Such deals can take many forms, but SCI focuses on those where synthetic or securitisation structures are utilised. Those deals can be broken down into the following broad categories (deals can be combinations of these categories): CDS - credit default swaps: in the capital relief trade context, this denotes deals that utilise such instruments to transfer credit risk. CLN - credit-linked note: in the capital relief trade context, this denotes the deal is structured as a note with an embedded credit derivative. Fin gtee - Financial guarantee: a means of structuring a capital relief trade, whereby the investors benefit from a guarantee that all the issuer's obligations will be met. Funded: where a capital relief trade is understood to have been structured using a credit derivative (CDS, CLN, synthetic CDO etc) with the protection seller making an initial payment. Unfunded: where a capital relief trade is understood to have been structured without an initial payment being made under the credit derivative (CDS, CLN, synthetic CDO etc). True sale: a capital relief trade based on a cash securitisation structure rather than a synthetic securitisation structure.


  • Risk transfer round-up - 1 July

    CRT sector developments and deal news

    NatWest is rumoured to be readying a capital relief trade backed by mid-market corporate loans for 3...

    News    1 July 2020
  • Structuring negotiations

    CRT origination trends evolving

    Investors appear to be able to extract more than they used to during structuring negotiations for ca...

    News Analysis    26 June 2020
  • Impact SRTs eyed

    Newmarket launches asset management business

    Newmarket has launched its asset management business, which will focus on the nexus of structured so...

    News Analysis    23 June 2020
  • Risk transfer round-up - 22 June

    CRT sector developments and deal news

    Deutsche Bank has completed a US$125.58m six-year CLN that references a US$1.932bn global corporate...

    News    22 June 2020
  • SCI Start the Week - 22 June

    A review of securitisation activity over the past seven days

    FREE - Capital Relief Trades Virtual Panel - LIVE Join SCI live again this Thursday, 25 June, for a...

    News    22 June 2020
  • Sicilian CRT launched

    BAPR completes SME securitisation

    The EIF and Banca Agricola Popolare di Ragusa (BAPR) have completed a synthetic securitisation refer...

    News    19 June 2020
  • Lift off

    Credit Suisse finalises SRT

    Credit Suisse has priced an Sfr130.5m equity tranche that references a Sfr1.8bn blind pool of medium...

    News    19 June 2020
  • SRT debut

    Sabadell completes first synthetic securitisation

    Sabadell has completed a €96m mezzanine guarantee with the EIF. The transaction references...

    News    18 June 2020
  • Bridging gaps

    Linking SRT originating banks with insurance partners

    Texel is aiming to help insurers and banks bridge gaps in their understanding of how each sector app...

    Market moves    17 June 2020
  • Risk transfer round-up - 17 June

    CRT sector developments and deal news

    Credit Suisse is rumoured to be readying a capital relief trade from the Elvetia programme that is s...

    News    17 June 2020
  • SCI Start the Week - 15 June

    A review of securitisation activity over the past seven days

    Last week's stories Addressing inconsistencies Performance metrics switched Calabria confiden...

    News    15 June 2020
  • Risk transfer rebound

    Deutsche Bank completes SRT

    Deutsche Bank has completed a US$325m CLN that references a disclosed US$5bn global portfolio of lar...

    News Analysis    12 June 2020
  • Euro ABS 'game changer' recommended

    Sector developments and company hires

    Euro ABS ‘game changer’ recommended The European High-Level Forum (HLF) on the...

    Market moves    11 June 2020
  • Risk transfer round-up - 10 June

    CRT sector developments and deal news

    Santander has exercised a 10% clean-up call for its Red-1 Finance CLO 2017-1 transaction. The UK com...

    News    10 June 2020
  • Resolve and resilience

    Content sponsored by Ocorian

    James Maitland, regional head of Americas, Bermuda & Caribbean, and global head of capita...

    Talking Point    10 June 2020
  • NCSLT consent judgment denied

    Sector developments and company hires

    NCSLT consent judgment denied Fitch has affirmed 37 notes and maintained its rating watch negative...

    Market moves    9 June 2020
  • SCI Start the Week - 8 June

    A review of securitisation activity over the past seven days

    FREE - Capital Relief Trades Virtual Panel - LIVE For a discussion on how the Covid-19 fallout has...

    News    8 June 2020
  • First steps

    STS synthetics paper receives qualified welcome

    The EBA’s final framework for STS synthetic securitisations has received an overall positi...

    News Analysis    5 June 2020
  • Risk transfer round-up - 5 June

    CRT sector developments and deal news

    Sabadell is rumoured to be readying an SME significant risk transfer deal for the second half of the...

    News    5 June 2020
  • Repricing of risk?

    Funded, unfunded investor collaboration to rise

    The outlook for the significant risk transfer market appears to be positive, at least in the short t...

    News Analysis    5 June 2020
  • Capital trouble

    GSEs stare down the barrel of reduced capital relief for CRT deals

    The re-proposed capital rules for the GSEs before they exit conservatorship, released by the Federal...

    News Analysis    5 June 2020