The guidelines are largely in line with those issued by other supervisors internationally and envisage the following: •  Detailed set of guidelines to ensure “arms” length relationship between the originator and the SPV  •  Credit enhancements provided by the originator for first as well as second losses to be deducted from the capital.
In essence, the main creditor needs to take a holistic view of the borrower’s position including other indebtedness and ensure that the entire debt is sufficiently restructured (a point explicitly made in the CCMA).