medium · Asset-Backed Securities regulatory

For a transaction to be 'Shelf-Eligible' under Regulation AB II, what must the sponsor do regarding 'Risk Retention'?

  1. Buy a stand-alone default insurance policy from an unaffiliated third party
  2. Transfer the full 100% of the underlying credit risk to investors immediately
  3. Comply with the credit risk retention requirements and disclose the method of retention
  4. Pledge the sponsor's corporate headquarters building and other assets as loan collateral

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