Covered Bonds Directive: Impact On UCITS

Background

A new EU framework for covered bonds will come into effect in Ireland on 8 July 2022 following the entry into force of the European Union (Covered Bonds) Regulations 2021 ("Irish Covered Bonds Regulation"). The Irish Covered Bonds Regulation gives effect to Directive (EU) 2019/2162 of the European Parliament and of the Council of 27 November 2019 ("Covered Bonds Directive") which enters into force on the same date.

The Covered Bonds Directive creates a uniform framework setting down specific structural features which must be satisfied by bonds issued by EU credit institutions which are to be classified as "covered bonds"¹ under the UCITS framework.

The current EU framework