The Financial Conduct Authority (FCA) has published Consultation Paper CP26/6, setting out proposed changes to the UK’s securitisation rules, including reforms to due diligence and transparency requirements.

The regulator said it has worked closely with the Prudential Regulation Authority to ensure a coherent and consistent framework across their respective rulebooks, with the PRA issuing a parallel consultation covering firms it authorises.

SIMPLIFICATION AND PROPORTIONALITY

The FCA said its approach is designed to simplify and streamline the current regime in order to eliminate unnecessary costs, while maintaining standards that support market integrity, innovation and competition, as well as the competitiveness of the UK financial services industry.

Central to the proposals is a more proportionate set of rules, aimed at reducing barriers to issuing and investing in securitisations without diluting investor protections.

The regulator also intends to provide a clearer framework for market participants in an effort to reduce legal and operational uncertainty.

The consultation states that the changes are intended to help the market operate with greater confidence and efficiency, while supporting a resilient financial system and facilitating growth in the real economy.

CHANGES TO TRANSPARENCY REQUIREMENTS

A significant element of the consultation focuses on transparency requirements. The FCA is proposing amendments to the underlying exposures templates used in securitisation reporting, with a view to simplifying them and aligning them more closely with the loan-level templates required by the Bank of England when firms submit certain types of collateral in the context of its market operations.

The proposed templates are marked up against the Bank’s existing loan-level data templates where applicable. The FCA has also provided additional information to assist firms in comparing the proposed changes with the current FCA Excel files available on its securitisation webpage.

The regulator said this alignment should reduce duplication and operational friction for firms that already report similar data to the central bank, while improving clarity in the wider market.

WHO WILL BE AFFECTED

The consultation will affect authorised firms involved in securitisation markets as institutional investors or manufacturers, as well as unauthorised entities acting as original lenders, originators or securitisation special purpose entities subject to the FCA’s SECN rules.

Individuals holding senior roles with responsibility for management decisions at firms active in securitisation markets will also fall within scope, alongside UK securitisation repositories.

The FCA is inviting comments on the proposals until 18 May 2026, after which it is expected to consider feedback before finalising any rule changes.

For UK lenders and investors operating in the securitisation market, the consultation signals a further step in the post-Brexit recalibration of financial services regulation, with the emphasis placed squarely on simplification and competitiveness rather than wholesale deregulation.