The Polish government is finally making progress with reforms to the country's corporate bond law. And that is good news for the securitization market that has, up until now, been severely restricted by prohibitive legislation on the establishment of special purpose vehicles and the need for deals to be issued with bank guarantees.
The amendments to the law have been under discussion for some time. The first bone of contention has been the need for banks to act as the legal guarantor on all public bond issues in the event of default. Also causing a nuisance is the company law that requires companies to have at least a three-year balance sheet history before they can acquire bond insurance, which effectively prevents SPVs from being set up.