ACC responds to IMF warnings on synthetic risk transfer

The International Monetary Fund (IMF) published its Global Financing Stability Report, which includes an overview of the Significant Risk Transfer (SRT) market.

According to the report, over $1.1 trillion in bank assets have been synthetically securitized since 2016, helping to reduce systemic risk and increase the financial system’s resilience.

The Alternative Credit Council (ACC), a private credit affiliate of the Alternative Investment Management Association (AIMA), published a detailed public comment letter addressing the key concerns raised in response to the report.

In the letter, ACC argues how SRTs:

  • Act as a true credit hedge, reducing banks’ credit exposure
  • Increase banks’ loss absorption capacity
  • Are already disclosed to banking supervisors

Read the full letter

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