FSA and Treasury publish plans for UK covered-bonds framework

The paper sets out guidelines that would enable UK-covered bonds to benefit from the EU’s UCITS directive. UCITS-compliant covered bonds can benefit from higher prudential investment limits. To comply with UCITS, the paper proposes that UK covered bonds must be:
• issued by a credit institution with a UK registered office;
• regulated by the FSA;
• supported by an asset pool that holds the sums raised by the bond issue, or eligible property of an equivalent value, and that has sufficient funds to