A new penalty system that penalizes clubs incurring out-of-control debt could further dampen appetite for U.K. soccer securitizations.

The 20 clubs under the Barclaycard Premiership aim to implement a nine-point penalty system for clubs entering into administration. Essentially, this means that clubs facing an insolvency will now have to consider being moved nine points lower in the ranks, which would expose the lower-tiered clubs to a greater risk of relegation (see ASR 6/02/02). For bankers, it means even greater uncertainty when it comes to structuring securitizations.

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