Securitisation could help plug Europe’s funding gap

The op-ed argues that securitisation could materially help close Europe’s estimated >€1tn annual funding gap to 2030 by deepening capital markets and reducing reliance on banks. The author (Pimco CEO) criticises the EU’s modest Savings and Investments Union proposals and an outdated UCITS 10% issuer cap that constrains mutual fund demand for securitised debt. Europe’s securitisation market is tiny (~0.3% of GDP vs 4% in the US); removing or materially loosening the cap could unlock roughly €150bn of pent‑up demand and ~€30bn in annual flows (a 20% cap would only add ~€20bn). Reforms that preserve concentration, liquidity and credit protections could expand high‑quality, low‑default securitised supply, enabling banks to free up lending capacity, diversifying funding sources and lowering systemic risk — a potential tailwind for European markets if regulators act, and a missed growth opportunity if they do not.