The global geopolitical landscape and innovation trends in capital markets — with a focus on artificial intelligence (AI) and distributed ledger technologies (DLT) — were among the central topics of discussion at the annual conference of the ICMA (International Capital Market Association), held in Frankfurt in early June.

The diversification of both investors and issuers, alongside efforts to strengthen transparency practices and standardize rules, was another major theme. Panels explored how regulatory advancements and new financing structures — including securitization and sustainable bonds — can help broaden access to capital markets, especially in emerging economies.

ANBIMA took part in the conference as a sponsor for the first time — an initiative that underscores the Association’s goal of promoting the internationalization of Brazil’s capital markets and aligning with global best practices.

One panel, moderated by Andrew Bryan of the law firm Clifford Chance, examined the evolution of securitization markets. The discussion, which featured Flávia Palacios — ANBIMA board member and CEO of Opea — covered the post-financial crisis regulatory environment, the emergence of new asset classes — such as data center and solar energy securitization — and the growing use of these instruments to fund the real economy, particularly in emerging markets.

Palacios drew attention to the recent growth of Brazil’s securitization market. “Our industry has grown significantly in the last five years — we’ve basically doubled in size,” she said, citing an increase in issuance volume from $17.3 billion in 2019 to $34.4 billion in 2024.

Green securitization bonds

She highlighted four key drivers behind this expansion: a broader and more sophisticated domestic investor base; more diverse companies using securitization to raise funds; the adoption of digital technologies that make processes more secure and efficient; and the rise of labeled bonds, especially green bonds linked to agribusiness. “Green securitization bonds have gained relevance and can serve as a gateway to attract foreign investors to our market,” she said.

Palacios also noted the modernization of Brazil’s legal and regulatory framework for securitization. Law 14,430 and Resolution 60, issued by Brazil’s Securities and Exchange Commission (CVM), have helped harmonize the rules applicable to securitization instruments and established governance guidelines, duties, responsibilities, and disclosure requirements for securitization companies. These measures have helped bring greater clarity and structure to the sector.

Although discussions around the impact of securitization on regulatory capital requirements are still in the early stages in Brazil, the country is paying close attention and learning from more developed markets to help shape the sector’s growth, Palacios noted.

Regulatory environment in Europe

In Europe, regulatory discussions have focused on capital requirements for banks, which has led to the rise of synthetic securitization — risk transfer operations that do not involve removing assets from the balance sheet. Instruments such as credit guarantees, credit-linked notes, and credit default swaps (CDS) are increasingly being used to create room for new business without the outright sale of underlying assets.

“The lack of a mandate requiring investors to allocate a share of their portfolios to green bonds is a strategic opportunity for Brazil to attract European investors,” Palacios said.

On sustainability regulation, Bryan of Clifford Chance pointed to Europe’s mixed results and asked about Brazil’s approach. Palacios responded: “We’re drawing inspiration from Europe and ICMA’s standards when it comes to mandatory rules for sustainability-focused market transactions, and we’ve launched a self-regulatory initiative at ANBIMA — particularly focused on taxonomy and principles for sustainable bonds,” highlighting the strong potential of green bonds given the weight of agribusiness in Brazil.

Real economy

Panelist Avisha Sookhee, director of Alternative Credit Europe Product Development at DWS Alternatives Global, reinforced the role of securitization in financing essential infrastructure in emerging markets. “There was a solar panel securitization we did, which was in Kenya — actually financing people who are off the grid in rural areas, allowing them to get electricity,” she noted. “And it all happened because we managed to partner with an asset manager."

Flávia Palacios (left) and Avisha Sookhee

Sookhee also discussed how insurers have retreated from the asset-backed securities (ABS) market since the financial crisis, attributing the shift to regulatory demands such as Solvency II. “We used to have a massive insurance participation in ABS before the crisis. Today, it’s negligible — and that’s primarily because of regulation,” she said, advocating for a review of capital requirements and investment limits to bring these players back into the sector.

Access to debt markets

Palacios also participated in the panel “Developing bond markets in emerging environments,” moderated by Natalie Westerbarkey, co-head of Market Practice and Regulatory Policy at ICMA. The session addressed the need to expand access to capital markets in developing countries.

“The issuance of commercial papers aimed at small and medium-sized enterprises, combined with securitization instruments, is key to expanding the fixed income market,” Palacios said. “SMEs often face barriers to accessing traditional credit. Bringing them into the capital markets can boost innovation, job creation, and economic growth.”

Panelists discussed ways to decentralize the investor base, which remains heavily concentrated in banks and credit funds across many emerging markets. Palacios emphasized the importance of attracting pension funds and foreign investors to deepen and strengthen the market. “Long-term capital from these investors can bring both stability and diversity,” she said.

Market infrastructure

Palacios emphasized ANBIMA’s ongoing work in self-regulation, transparency, and standardization. “Our structuring rules set clear conduct requirements for all participants in public offerings, including investment banks and securitization companies,” she said.

She also presented ANBIMA’s latest initiatives focused on green, social, and sustainable bonds. “Our rulebook, based on ICMA’s principles, includes mandatory second-party opinions, company sustainability frameworks, and extensive disclosure on risk factors and performance indicators. In some respects, we’ve even gone a step further,” she said.

Alongside the development of Brazil’s fixed income and securitization markets, ICMA conference participants emphasized the importance of aligning practices and rules with global standards. “If we could follow the same standards — including regulatory ones — it would be much easier to grow our market,” Palacios concluded. “My role is to take this homework back and learn from your lessons here.”