ECB Proposes Letting Funds Invest More in Securitizations

The European Central Bank called for mutual funds in the region to be allowed to invest even more in packaged credit from individual lenders as politicians lean on the market to support growth.

The European Commission has already suggested raising the cap on so-called UCITS funds’ holdings of “simple, transparent and standardized” securitizations by a single entity to 15% from 10%. In an opinion published on Friday in Frankfurt, the ECB suggested going further.