Europe ABS Market Outlook

the european abs market is composed of many different asset classes, including auto loans, credit cards, student loans, residential mortgages, consumer and small business loans, and home equity loans. these asset classes are subject to changing economic and market conditions, and investors must be aware of the current landscape in order to make informed decisions. the market outlook for 2018 and beyond is expected to remain positive, with a continued focus on the development of securitization from both public and private sectors. abs is seen as a direct alternative to traditional bank financing and is advantageous due to its relative liquidity and cost advantages. revolutionary changes in the regulatory landscape could have a significant impact on this market. pressure for compliance with the new basel regulations, which will become applicable to non-banks this year, may require some major banks to tap abs markets to increase their capital requirements. additionally, the european central bank’s new interest rate policy measures could lead to a rise in abs issuance as the central bank seeks to bolster liquidity and ensure financial stability. in terms of specific trends within the market, there is an emphasis on the development of innovative new abs structures such as the securitization of distressed assets and asset-backed securities (abs). expansion of the investor base to include international players and non-banks is also being actively pursued. as the abs market matures, improvements in transparency, pricing and risk management are being seen, which bodes well for continued interest in the market. additionally, investors are encouraged by the presence of multiple funding sources, with some public funding being provided and other financing projects being supported by private investors. despite some political, economic, and legal uncertainties, over the long run, europe’s abs market is forecast to remain strong and active. as investors become more comfortable with securitization, it should continue to experience more stability and increased growth. therefore, investors should continue to monitor the current market conditions and political developments in order to determine the optimal approach to investing in the european abs markets.