More than fifteen years after the Global Financial Crisis, securitisation in Europe remains structurally underdeveloped, despite repeated political recognition of its potential contribution to growth, risk-sharing and capital allocation. Compared with the United States, where asset-backed securities represent a much larger share of market-based finance, the European market remains modest in both absolute and relative terms, and concentrated in a limited number of Member States. Despite record issuance in 2025 (~€159bn), the STS segment remains stuck below 40%, securitisation activity is increasingly dominated by CLOs, and the overall market structure has not fundamentally changed.

The EU is entering a period of unprecedented investment needs to finance the green and digital transitions, strengthen industrial capacity, enhance defence capabilities and improve overall competitiveness. High-level reports, including the Draghi report and the Competitiveness Compass, converge on the same diagnosis: EU capital markets remain too shallow, overly reliant on bank balance sheets, and insufficiently equipped to mobilise private capital at scale. Securitisation is increasingly identified as a missing link in this architecture, capable of supporting secondary markets and attracting long-term institutional capital.

The Commission put forward a targeted review of the EU securitisation framework in June 2025; the Council adopted its negotiating position in December 2025. Whilst the direction of travel is broadly welcomed, many investors and market participants consider the package insufficiently ambitious. Concerns persist over lingering prudential distortions, regulatory fragmentation across investor types, and the risk that mechanical interactions between prudential rules could continue to constrain demand. The question is no longer whether securitisation should be revived, but how far, how fast and under which market and governance model.