New opportunities, more dynamism: European securitisation is gathering pace
Thomas Docters van Leeuwen, Executive Director ABS / Alt.Credit, DCM Syndicate, ABN AMRO
There is new élan in the European securitisation market. A pragmatic regulatory environment and new products such as data centre ABS are injecting fresh energy into a traditionally conservative investment space. Thomas Docters van Leeuwen, Executive Director ABS / Alt.Credit, DCM Syndicate at ABN AMRO explains this renewed bullishness.
How would you characterize the European securitization market in 2025?
It was a strong year. European issuance reached record levels, and performance was solid across the board.
The autumn looked materially different from 2024. That year, issuance was heavily front-loaded into September as issuers sought to avoid the US elections in November. That compressed a large volume of supply into a short window and led to some market softening.
In contrast, September last year was again busy but absorbed smoothly. With no comparable political overhang, issuance extended more naturally into October. Taken together, it was a constructive year for the market.
What emerging trends stood out over the course of the year?
Two themes stand out and are carrying into this year. First, data centres. There is a meaningful pipeline of data centre ABS in Europe looking toward 2026. We are active ourselves and see quite a pipeline for the coming months. The Yondr UK transaction was just announced, the third European DC ABS to see the light of day. It is the first for this year, but it is almost certainly not the last.
The second trend has been developing for longer. UK issuers, in particular, have been moving toward master trust structures. These allow issuers to add new compartments within an existing SPV and issue far more efficiently. Time to market falls from weeks to days. This approach is now spreading: BPCE recently executed a French home loans transaction from a master issuer.
Why is the master issuer structure gaining traction now?
As more frequent issuers adopt this structure, it increases market agility. Being able to execute in two or three days rather than two weeks is a material advantage.
That flexibility matters in the current environment. Financial conditions are broadly supportive—inflation is contained, growth remains reasonable—but headline risk is elevated. Geopolitical tensions and policy uncertainty, particularly from the US, create episodic volatility. For a comparatively slow-moving product like ABS, speed of execution becomes valuable optionality.
Longer execution windows increase the risk of disruption. If an issuer can decide on Monday to price on Thursday, the hurdle to market entry is materially lower.
How has geopolitical tension affected the market?
Intermittently. Liberation Day last spring effectively closed the market for a couple of weeks, but the disruption was short-lived.
Typically, deal preparation continues during these pauses, but pricing becomes difficult amid uncertainty. Investors are forced to price volatility, which quickly becomes uneconomic for issuers. In practice, there is an unspoken agreement to wait until conditions stabilise. When they do, issuance resumes abruptly, producing a visible post-event spike.
What’s changing on the regulatory front?
There is a renewed recognition that securitization matters for the capital markets union. That argument has been made before, but it is now being accompanied by concrete action: efforts to streamline regulation and reduce capital charges for investors in ABS.
This is particularly relevant for bank treasuries, which remain core buyers of the asset class. Lower capital friction makes allocation decisions easier and widens demand.
More broadly, there is momentum toward simplification. One persistent inefficiency in securitization is the repeated, deal-by-deal burden of reporting and agency processes. There is clear low-hanging fruit in improving operational efficiency.
Let’s discuss data centre ABS. Why is this asset class attracting so much attention?
The scale of the AI and data-centre build-out means sponsors need access to every available financing channel. Even with a deep and active bank market, alternative sources are required. ABS and private placements are increasingly part of that mix. The logic is straightforward: the pipeline is simply too large to rely on a single funding source.
For ABS, this is also a welcome diversification. The market has long been dominated by cars and houses. Data centres sit squarely within the current growth narrative of capital markets, closely tied to AI and digital infrastructure. That thematic relevance has created a positive spillover effect for the asset class.
How does data centre ABS differ from traditional securitization, and who’s buying it?
The differences are significant. Data centre ABS is typically fixed-rate, whereas traditional ABS is usually floating-rate. Conventional ABS investors are accustomed to granular pools with thousands of assets, allowing for detailed modelling and performance forecasting.
Data centre transactions, by contrast, may be backed by one to three assets, often leased to hyperscalers such as Microsoft, Amazon Web Services, Apple or Google. The risk profile is closer to corporate or project finance risk, albeit wrapped in an ABS structure.
As a result, the investor base skews more toward accounts comfortable with structured corporate exposure—project finance investors and similar. While there is overlap with traditional ABS buyers, the books tend to feature a different and more US-influenced investor set.
Is investor appetite building, or is there still hesitation?
Both. Our investor survey and bilateral discussions suggest lingering caution. Many investors see data centre ABS as structurally different, requiring mandate changes or a longer performance history. Some prefer to watch the asset class mature before committing.
That said, volume has a way of forcing engagement. As issuance continues, there is a point at which the asset class becomes too large to ignore. The market is moving in that direction, and we see ABS investors one by one come into this new asset class or consider doing so.
What about market dynamics? Any shifts in investor appetite across the capital structure?
For an extended period, mezzanine tranches were relatively easy to place, while senior tranches were sometimes more challenging. Mezzanine paper tends to be smaller and offers higher spreads, which suits many accounts. By late Q4, that imbalance had largely corrected.
Early-year prints reinforce that shift. German auto transactions are clearing again in the low-40s, with Dutch prime RMBS in the low-to-mid-40s. Senior demand looks robust.
What’s your outlook for 2026?
It is very positive. Issuance volumes should continue to grow, supported by sustained investor participation and, in turn, tight pricing.
The funding differential between securitization markets and deposit-funded banks has narrowed. For a period, securitization was materially more expensive than deposit funding. That gap has now compressed, improving the relative economics for issuers.
Private credit is also an important part of the securitization ecosystem, particularly for non-bank lenders that rely on capital markets funding. Despite volatile headlines, this remains a growing segment. In Europe, it is more regulated and structurally more stable than in the US, where recent strains have been more evident.
Overall, the fundamentals for the year ahead look strong.
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At the Securitisation Event 2026, market leaders explore how growth, regulation, new asset classes, AI, technology and data centres are reshaping Europe’s securitisation market. Expect concrete cases, practical insights and open debate across the full value chain. Join the largest annual Dutch securitisation platform and connect with the entire structured finance community.
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