Covered Bonds and European Secured Notes (ESNs)

Covered Bonds and European Secured Notes (ESNs)

There is a lot of discussion about introducing new types of covered bonds backed by different asset classes. To distinguish this idea from traditional covered bonds, most people refer to the proposed bonds as European Secured Notes or ESNs. In this video, Richard takes a look at the prospects for the European Secured Notes market and what it might look like.
Overview

Covered bonds are traditionally backed mainly by residential mortgages and public-sector loans. However, European Secured Notes are new types of covered bonds that are backed by loans to small and medium enterprises.

Key learning objectives:

  • Explain the new asset class and its disadvantages

  • Identify cases whereby ESNs have been mirrored before, and the people most likely to use it today

  • Describe the structural differences between ESNs and traditional covered bonds

  • Outline the success prospects of ESNs and what it depends on

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Summary
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Expert
Richard Kemmish

Richard Kemmish

Richard is a consultant working mainly in the covered bond market. He helps Finance Ministries and Central Banks in countries without covered bond laws to put legal frameworks in place. He has also helped the European Commission with their legislative agenda for covered bonds and related products.

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