ESG & Significant Risk Transfer
A special report for SCI Premium Subscribers
Significant risk transfer is primarily associated with achieving favourable capital treatment. However, the utility of the instrument as a catalyst for ESG/positive impact financings - by enabling banks to redeploy capital from legacy ‘dirty’ assets into new ‘clean’ assets - is gaining traction, according to SCI’s latest CRT Research Report. This report explores the processes and infrastructure involved in originating impact SRTs, as well as documentation and transparency issues, how to assess performance, incentivising/facilitating further volume and the role of ESG considerations in credit risk management.