- Bank of Montreal has completed two synthetic risk transfer (SRT) deals totaling $5 billion in corporate loans, utilizing its Muskoka and Algonquin programs.
- These transactions allow BMO to reduce its regulatory capital burden by transferring a portion of potential loan losses to outside investors, without selling the loans.
- The deals highlight a growing trend among Canadian banks to use SRTs as a capital management tool, driven by strong investor demand for such products.
Topics: Asset types, Institutional adoption, Risk default, Financial instruments, Banking depository pilots, Credit counterparty risk
Tags: #bankofmontreal #syntheticrisktransfer #corporateloans #capitalrelief #investorappetite #firstlosstranche #regulatorycapital #canadianbanks #assetmanagement