Cyprus has enacted legislation which completes its framework
regulating the purchase and sale, as well as the securitisation of
credit facilities. This note covers securitisations, with our
parallel
update covering the acquisition and sale of
loans.
Securitisation involves transactions that enable a lender or a
creditor – typically a credit institution or a corporation
– to refinance a set of loans, exposures or receivables, by
transforming them into tradable securities accessible by
investors.
By enacting the Securitisation of Credit Facilities or Other
Forms of Claims or Exposures Law, L. 88(I)/2018 (the
Law), Cyprus has established a framework for
securitisation of credit facilities in Cyprus. It is envisaged that
the Law will facilitate the secondary market for loans which may
consequently enhance efforts to reduce non-performing loans. The
scope of the Law is limited to the securitisation of credit
facilities or other forms of receivables and/or
