The European Commission last week ended its consultation period on the reports of two expert groups established in April 2006. These groups were created to explore the issues of mortgage funding and consumer protection integration. If plans move ahead, Europe could be looking at a more united mortgage market, although it's doubtful whether the fragmented regulatory environment will readily incorporate and adapt to a pan-European approach to mortgage funding.

Ten EU member states currently have some form of securitization law. In most cases, there is not a single "securitization law," but rather a series of amendments to various statutes and regulations that were developed around the specific public policy or commercial interests in each country at the time the respective securitization laws were passed. But despite the inconsistency, RMBS issuance volume has been significant both in countries that have and don't have these laws. Harmonizing the mortgage market framework would only further facilitate lender banks establishing themselves in a new market and, in the long run, result in greater RMBS market liquidity.

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