Significant Risk Transfer (SRT) Advisory
For banks managing corporate loan books or diversified portfolios, we structure synthetic securitisations that transfer junior or mezzanine risk tranches to third-party investors or insurers—delivering durable capital relief while preserving client relationships and balance-sheet control.
Define the risk transfer perimeter and calibrate junior / mezzanine tranches to meet both economic risk objectives and regulatory expectations.
Transfer credit risk while keeping assets on the balance sheet—maintaining origination economics, servicing, and client relationships while shifting capital intensity away from the regulated entity.
Identify and structure execution pathways via third-party investors or insurers, with terms designed to withstand supervisory scrutiny (including durability and maturity alignment considerations).
We advise on structuring the transaction so the captive can participate in specific tranches—often by reinsuring a fronting carrier—allowing the group to retain the economic benefit of risk premia while achieving regulatory derecognition through an eligible counterparty.
- ■ Transaction blueprint: tranche sizing, attachment / detachment, pricing logic
- ■ Counterparty / placement route: investor vs insurer, fronting and collateral considerations
- ■ Captive participation design: reinsurance treaty structure and governance requirements
- ■ Implementation support with brokers, arrangers, counsel, and market counterparties
Time-bounded advisory to define and implement an SRT structure with clear regulatory intent and economic retention. We work alongside your treasury, risk, finance, broker/arranger, captive manager, and counterparties.
- ■ Corporate / SME portfolios under Basel 3.1 capital pressure
- ■ Institutions seeking capital relief without selling assets
- ■ Groups with an existing captive (or clear path to one) to retain economics