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LONDON, June 11 It is up to the market and not
public authorities to take the leading role in reviving the
asset-backed securities sector, Andreas Dombret, a member of the
board of Germany's Bundesbank said on Wednesday.
The European Central Bank and Bank of England are trying to
revive the market for asset-backed securities (ABS), which pool
loans such as mortgages into bonds, to raise funds for
investment in the economy.
The two central banks want more lenient regulatory treatment
of top quality ABS to encourage more banks to generate the debt
and investors to buy it.
The tarnished sector is a fraction of its size after the
2007-09 financial crisis, which began when securities based on
sub-prime U.S. home loans became untradable.
"Clearly asset-backed securities as an asset class got into
trouble during the crisis," Dombret told reporters during a
visit to London, adding that the sector should not be
"Investors are interested in asset-backed securities and
there is a good reason why it's important to revitalise the
asset backed securities market," Dombret said.
"First and foremost it's a job for the industry itself. One
should not always call for the public sector to be in the
forefront when it should be in the interests of the market
itself to revitalise that."
(Reporting by Huw Jones; Editing by Catherine Evans and Toby