Asset Based Finance in Germany and TSI - the two terms are closely linked. True Sale International GmbH (TSI) emerged in 2004 from a banking initiative in Germany to promote the German securitisation market. Today, the topics of the TSI go far beyond this and cover broad areas of the asset-based finance market.
The original aim of the TSI was to enable banks in Germany to securitise their own loans and create a brand for German quality securitisations in accordance with German law and on the basis of a standardised procedure agreed with all market participants. The now well-established "DEUTSCHE VERBRIEFUNGSSTANDARD" sets standards in terms of transparency, investor information, exclusion of Originate to Distribute structures (OTD) and lending and processing standards. TSI shapes the German market for securitisations and assed-based finance with its events with more than 1.000 participants annually, its internet presence and its public appearance. TSI always looks beyond the end of its nose and covers also current market trends such as blockchain, fintech and digitilisation effects and changes in the financial and real economic framework conditions.
Securitisations have proven their worth in Germany and for the German economy securitisation is an important link to the capital market. The sales financing of the German automotive industry, the financing of asset leasing, the working capital financing of German industry and trade - securitisations are increasingly used in all areas. In recent years, between 30 and 40 billion euros in leasing, trade receivables and loans have been securitised on a regular basis.
- Tailwind from structural change – focus on CO2 reduction and infrastructure projects will promote project finance and asset-based finance transactions
- Securitisation regulation – potential for improvement through the review of the Securitisation Regulation, possible relief in the CRR and implementation of ESG for securitisations
- Quality segment STS – due to increasing financing needs and economic outlook, market development (volume and performance) will continue to be positive for true sale securitisations and increasing relevance for on-balance transactions (synthetic) also for medium-sized credit institutions
- ESG & Asset Based Finance – time lag in securitisations due to unclear definitions, lack of ESG assets and data availability, shift from ‘financed assets’ to ‘use-of-proceeds’ approach as in other debt products (impact investment)
- Transparency – expansion of the high level of market transparency and integrity in securitisation as a competitive advantage over other forms of financing
- Digital business models will provide momentum – trend towards ‘using instead of owning’ mobile assets with effects on contract design (smart contracting), financing and billing
- Transformation funds – government-initiated financing programmes involving private investors and their preferred banks with potential for securitisations
- Variable interest - preference for refinancing with floating interests
A. Public relations & further development of legal framework
Contribute to and prepare the following topics:
- ESG and Sustainable Finance Regulation for securitisations: Contribute to market development, ensure level playing field to other debt instruments and use transparency advantage
- SME financing: enabling and supporting asset-based financing models within the framework of a transformation fund
- Review securitisation regulation by EU Commission and supervisory authorities with potential for improvement in various areas (SECR, CRR, LCR, Solvency II, ESG), legislative proposals expected from the end of 2022 onwards
- Accompany securitisations in particular for capital management in the context of the finalisation of Basel III (‘Basel IV’), STS for synthetic ABS and SRT rules
TSI in intensive dialogue:
- with selected representatives of the German business community and its associations (including BDI, DIHK, VDA, VDT) on structural change in the financial and real economy and effects on financing
- with European (including EBA, ESMA, ECB) and national supervisory authorities (Deutsche Bundesbank, Bafin) as well as with domestic and European policy-makers on strengthening asset-based forms of SME financing, especially in the transformation process
- with the European Central Bank in connection with monetary policy, purchase programmes and collateral framework with reference to securitisations
- with selected new stakeholders in the field of ESG & sustainability regulation
- on capital market issues with German academia specifically on digitalisation, climate change and sustainable finance
B. Securitisation and STS as a quality product
- Consolidate the success of STS as a European capital market segment across all asset classes and intensify contact with supervisors, originators, investors and other stakeholders.
- Further expand STS verification for on-balance sheet securitisations (synthetic) with growing number of issuers in Germany and Europe
- Maintain ‘VERIFIED SVI’ and ‘DEUTSCHER VERBRIEFUNGSSTANDARD’ as quality brands
- Further develop the German securitisation framework as a contribution to Germany as a financial centre and improve direct and indirect capital market access for SMEs
C. Partner network & events
- Position TSI Congress with central topics as a high-quality event in the European asset-based finance environment and further increase local presence (hybrid format as standard)
- TSI training and workshops: Return to more face-to-face events, add conference formats in spring, online formats to increase reach and faster access to partner network and market participants
- Events on relevant topics around financing structural change, sustainable finance, digitalisation and implications for securitisation transactions
- Further expansion of the partner network and client base at European level with the topics ESG and digitalisation
- Complete relaunch of the TSI website incl. partner presentation and new topics as a further step towards strengthening and expanding the TSI network
In its endeavours, TSI has the support of many partners – banks and law firms, rating agencies, auditing companies and service providers. It thus reflects the breadth of the German market.
TSI's Advisory Council plays an important role in the company's work. It comprises board members and CEOs of major German banks, the four large rating agencies with ECB recognition, two auditing firms and a representative of the Federal Ministry of Economics and Technology. It identifies and discusses key issues to be taken up by TSI. To the Advisory Council of TSI
TSI has the support of a broad, top quality network formed, at present, by 70 enterprises from the asset based finance industry. TSI Partners come from all sectors of the German securitisation market: banks, consultancy companies and service providers, law firms, rating agencies and professional associations. The unifying factors are competence and experience in the securitisation market and a common interest in further developing that market. TSI Partners derive particular benefit from TSI's lobbying and PR services. If you would like to find out more about the individual TSI Partners, their competence with regard to the securitisation and asset based finance market and their range of services, just click TSI Partners to access more detailed information.
Chair of the TSI shareholders' meeting:
Dr Matthias Hillmer, DZ BANK AG