WASHINGTON, November 6, 2025 – The Structured Finance Association (SFA), a leading trade association representing the structured finance and securitization industry, applauds Chairman Tim Scott, Senator Mike Rounds, and their colleagues for their letter to the Federal Reserve urging a final revised Basel III Endgame rulemaking.
The senators’ letter underscores the need for the Federal Reserve to assess capital requirements holistically while also highlighting a securitization calculation known as the p-factor, which is crucially important to SFA members and the market writ large.
“Securitization is a critical tool to economic growth,” said Michael Bright, CEO of the Structured Finance Association. “In the years since the global financial crisis, the securitization market has focused intensely on ensuring underwriting standards that allow for safe and responsible access to credit. Good loans make good securities, and we hope the final Basel proposal takes this into account.”
The p-factor is an intentionally punitive scaler that differentiates capital levels between loans held on balance sheet versus those loans put into securitizations. A recent previous proposal called for doubling the p-factor to 1.0 without economic justification or analysis.
“As regulators continue their important work to finalize the Basel III Endgame, we appreciate Chairman Scott, Senator Rounds, and their colleagues for recognizing the importance of technical details like the p-factor,” said Daniel Grattan, Global Head of Advocacy for the Structured Finance Association. “Their engagement ensures that capital rules are informed by data and market realities, supporting both financial stability and access to credit.”
About the Structured Finance Association:
With more than 370 member institutions comprised of accounting firms, broker/dealers, diversified financial intermediaries, investors, issuers, IT vendors, law firms, mortgage insurers, other small financial institutions, rating agencies, servicers, and trustees, SFA is the leading voice for the global securitization industry.
SFA is focused on helping grow the real economy and improving the lives of individuals, families, businesses; helping make credit more affordable and available to people who need it to finance some of life’s biggest goals — education, car purchases, starting a business, buying a home — or reduce their debt through consolidation loans; safeguarding essential protections for consumers and the financial system; facilitating valuable dialogue among the financial services market, its practitioners, policymakers and the broader public; and recognizing that all finance entails risk, but it should not involve recklessness.
For inquiries, please contact:
Walt Cronkite, Director of Communications, SFA