The Structured Finance Industry in Ireland

With a developed and supportive legal, regulatory and fiscal regime Ireland is at the forefront of the evolving structured finance industry. This environment, together with established industry experience and expertise Ireland is highly regarded as the location of choice for international arrangers for the establishment of special purpose vehicles for asset-backed securities (ABS), catastrophe (CAT) bonds, collateralised debt obligations (CDOs), collateralised loan obligations (CLOs), commercial mortgage backed securitisations (CMBS), asset backed commercial paper (ABCP), distressed debt, loan participation notes (LPN), medium-term notes (MTN), repackaging, residential mortgage backed securitisations (RMBS), US life settlements, and other structured finance transactions.

According to the Central Bank of Ireland, SPVs or financial vehicle corporations (FVCs) valued at almost €500 billion were resident in Ireland at the end of 2011. Ireland is the location for almost 22 per cent share of total European FVC assets.

Structured finance techniques are used by a cross-section of the international financial services industry in Ireland. The aircraft leasing sector for example, uses SPVs to finance and hold certain types of assets, as does the investment fund sector. The insurance sector uses SPVs to issue insurance related debt securities

It is estimated that the structured finance industry employs over 700 people directly, contributing about €75 million in taxes to the state each year. According to Accenture, for every 1.5 SPVs that are incorporated in Ireland, about one job is created.

The Irish Stock Exchange is a world leader in the listing of debt instruments and as of the second quarter of 2012, there were almost 21,000 debt security tranches listed on the Irish Stock Exchange.