Last week ASR reported that France was still awaiting implementation of its new securitization decree issued in August 2004. The Financial Security Law was actually published on November 26, 2004 and fully replaces the decree of 1989, significantly altering the basis for Fonds Commun de Creances (FCC).
The new securitization decree makes clear that FCCs may enter into, subject to certain conditions, credit derivatives agreements as protection buyers or as protection sellers. FCCs are now eligible to issue long- and medium-term notes in addition to issuing units and will have access to the CP markets via the titres de creances negociables. These notes are more attractive to foreign investors, while units will continue to appeal to the domestic investor.