226 iCnatpoitfaolrRceeqausiroefm2e0n1t1s Rfoergnuelawtiosnec(uCrRitRiz)ations, are set out in Article 405 of the 68 for securitizations issued before 2019 aRne dg u sl aetci uo rni.t Ti zhaet i rounlse si ss st auteedt ht ahtetrheea fot er irg isnhaot ou rl ,ds pcoonms po lry, o wr oi trhi g itnhael lSeencduerri tsi hz aotui ol dn, as et caul rl i tt ii mz aet si o, nr ettraai nn s aa cmt i oa nt e. rTi ahle npeut r epcoosne oomf it ch ei nrtuelree si st toof bneot tleers sa l ti hg na nt h5e%i n itne rtehset of the originator and investor by requiring the originator to retain a significant portion of so-called skin-in-the-game. Trehteenrtuiolen amlleotwhos dtshetoohrioglidnatthoerirtoposretlieocnt oofne of the different regulatory risk skin-in-the-game. A portion of the equity tranche, corresponding to at least 5% of the total nominal value of the st he ec uf ri ri tsitz leods se xe px po os us ur er se, (i Fs LrEe )t ami neetdh oi nd taht el efai rsst t 5l %o s so ft rt ahne cchree d( Fi tLrTi )s kmaet t thhoed l ea vnedl ionf et hvee rrye tsaei cnuerri triezteadi nesx ap opsour rt ei o ins or ef teaai cnhe dt r. aWn chhi lee oi nf mt hi ne ivme ur tmi c a5l%s l. i Icne t(hVeE oS n) -mb ae ltahnocde, se hx pe eots u(rOeBs So)f ma t eltehaosdt , 5 t%h eo fr et ht aei nneormki ne ea pl sv aal u reafnr do ommtlhye seenl evci st ea dg e pd oarstsi oe nt poofo lt hi ne his books. Tn oh te dsitsatri nt i gnugi spho ibnet t wo fe eonu rt hset uddiyf f ei sr etnhta tr i tshke r eEtuernotpi oena nmrei st hk ordest eanntdi o na l lrouwl ess t dh oe oc ar pi gi itna al troerl i teof . uTshe i sw sheaet me vse rs uorppt ri oi sni nsgu, i tgsi vbeens tt, hwa ti t thhoeuste amn ye tchoondsse qdui fef ne rc ei sn ot ne rtmh es of risk and return profiles for both the retainer and the investor and the way their incentives align. In line with that, previous literature (see, e.g., Bektić & Hachenberg, 2021; Kiff & Kisser, 2014; Malekan & Dionne, 2014) provides evidence for existing differences. As the different risk retention methods vary in terms of risk profile, we would expect that these methods have an impact on 68 Article 405 of Regulation (EU) No 575/2013 Retained interest of the issuer.
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