ESMA_QA_40
26/10/2020
Subject Matter
Follow up question about OLTV “RREC16”
Original question
Even though asked in Question Q5.2.10 e) it is still not clearly stated if the ‘Original Loan-To-Value’, similarly to ‘Current Loan-To-Value’, of loan 1 is also to be updated when issuing loan 2 at a later point in time or if the ‘Original Loan-To-Value’ must be constant over the lifetime of loan 1.
Suppose there are two loans A & B at time 0 and we apply a pro rata approach, as stated in Q5.2.10d), for the OLTV. At time 1 a new loan C against the same collateral is issued. Is the OLTV of loan A and B to be updated, to complete a pro rata approach for all three loans? Or does the OLTV of Loan A and B stay constant over the lifetime of the loans?
Suppose there are two loans A & B at time 0 and we apply a pro rata approach, as stated in Q5.2.10d), for the OLTV. At time 1 a new loan C against the same collateral is issued. Is the OLTV of loan A and B to be updated, to complete a pro rata approach for all three loans? Or does the OLTV of Loan A and B stay constant over the lifetime of the loans?
ESMA Answer
09-11-2023
Original language
Please see Q/A 1323 which covers the situation under e)
Status: Answer Published
Additional Information
Level 1 Regulation
Securitisation Regulation (EU) 2017/2402
Level 2 Regulation
ITS on the format and standardised templates for making available the information and details of a securitisation by the originator, sponsor and SSPE and associated ANNEXES
Topic
Securitisation Regulation