Structured Finance
Many established worldwide names have faced bankruptcy in recent times and we have witnessed significant intervention by governments and central banks around the world. Locally, the Irish government's response to the banking crisis has been through recapitalisation programmes and the creation of the National Asset Management Agency (NAMA). These recent market developments have led the competitive and regulatory landscape to evolve at an unprecedented speed.
Today’s significantly altered marketplace will continue to offer tremendous opportunities and potential benefits to issuers and investors for securitisations and structured finance vehicles. Increased regulation will demand greater transparency and create a tougher competitive environment. Ireland's tailored securitisation vehicle, the Section 110 company, will continue to remain a viable and reputable alternative for businesses in providing:
- A strengthened capital and liquidity regime
- Access to an alternative funding source compared to traditional funding mechanisms
- A simple and transparent market acceptable location
As the market alters, and in response to client structures and behavior in the investment sector, Ireland as a jurisdiction is constantly responding in terms of its legal and tax framework. Ireland continues to be perceived as a very attractive jurisdiction in which to locate securitisation vehicles.
Advantages of Ireland as a securitisation location
- Member of the Eurozone and OECD
- Well developed tax and legal framework
- Acceptable jurisdiction from the perspective of the rating agencies and sponsors
- Transparent regulatory environment and simple tax regime
- Quality pool of experienced service providers and advisors
- Ability to list on the Irish stock exchange in a timely and cost efficient manner
- Extensive double tax treaty network. Ireland is currently party to 46 double tax treaties
- Ability to achieve tax neutrality under Irish securitisation tax legislation
“In current market conditions Irish Section 110 securitisation vehicles can offer opportunities for investors to acquire distressed debt with the potential for high returns as part of a balanced portfolio”