Financing
Turning a portfolio into liquidity
“An entity transfers receivables to the fund, which issues securities backed by them, and the entity obtains immediate liquidity.”
Securitization Fund Management Company (SGFT) in Spain
Securitization funds have no legal personality: they are set up, administered and represented by an SGFT (sociedad gestora de fondos de titulización). It is a CNMV authorization with €1 million of capital, an exclusive corporate purpose and a six-month time limit, governed by Articles 25–33 of Law 5/2015 (Ley 5/2015).
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Services
What we do for you in securitization
Setting up the management company is both a corporate and a regulatory project. And the CNMV’s time limit is six months.
Authorization
CNMV authorization application
Draft bylaws, explanatory report, program of activities, fit and proper assessment of directors and identity of significant shareholders. The entire Article 27 application, prepared to be filed in one go.
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Art. 276 monthsCNMV
Structure
Designing the securitization structure
Which assets are transferred, how the risk is isolated, which tranches are issued and what contractual documentation underpins the transaction. The management company is the vehicle; the structure is the business.
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TransferTranchesIsolation
Prospectus
Prospectus and issue document
The management company is liable to holders for the information in the prospectus.
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ProspectusTransparency
Fit and proper
Fit and proper assessment of directors
Good repute, knowledge and experience of the people who will run the management company.
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Good reputeExperience
Shareholders
Significant shareholders
Identifying and assessing the people who will control the company.
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HoldingControl
Portfolios
Securitization of acquired portfolios
When the asset to be securitized comes from a portfolio purchase.
Learn more →
NPLPortfolio
Concept
What an SGFT is and why it exists
The fund has no legal personality. The management company lends it its own.
A securitization fund is a separate pool of assets without legal personality, made up of the assets transferred to it and the securities it issues. Because it has no legal personality, it cannot act on its own: someone has to set it up, administer it and represent it vis-à-vis third parties. That is exactly why the securitization fund management company (SGFT) exists.
The SGFT is governed by Articles 25–33 of Law 5/2015 of April 27 on the Promotion of Business Financing, within its Title III. Article 25(1) defines its corporate purpose: the setting up, administration and legal representation of securitization funds and of bank asset funds. The same law also allows SGFTs to manage similar funds set up abroad.
It is worth understanding the practical consequence of that exclusive purpose: an SGFT cannot do anything else. It is not a financial services company that also manages securitizations; it is a company whose only possible activity is that one. Any project that wants to combine managing securitizations with another line of business will have to solve it through the corporate structure, not by placing it inside the management company.
Requirements
Article 29 requirements
Eight conditions. Two of them—capital and exclusive purpose—shape the entire structure of the project.
| Requirement | Content | Practical note |
|---|---|---|
| Corporate form | Public limited company (sociedad anónima) formed by simultaneous incorporation and with indefinite duration | Simultaneous incorporation rules out successive incorporation: all the capital is subscribed in the act of incorporation. |
| Share capital | €1,000,000, fully paid up in cash and represented by registered shares | Paid in full in cash; no non-cash contributions allowed |
| Additional own funds | An increase of 0.02% of the book value of the managed funds’ assets in excess of €250 million | Scales with the volume under management: the requirement grows with the business. |
| Own funds cap | The total required own funds plus the additional amount may not exceed €5 million | There is a ceiling: the requirement does not grow without limit |
| Corporate purpose | Exclusively the purpose set out in Article 25(1) | No ancillary activity is possible within the management company itself. |
| Registered office | In Spanish territory | Align the registered office and effective management from incorporation. |
| Name | Must include “Sociedad Gestora de Fondos de Titulización” or the abbreviation SGFT | Reserved name: Article 28 restricts it to authorized entities. |
| Internal organization | Adequate administrative and organizational measures, including prevention of conflicts of interest and regulatory compliance | It is the most neglected block and the one that raises the most questions in the application. |
Eligible own funds are determined under the collective investment scheme rules, with any specific features the CNMV may set. It is advisable to check the figures against the current consolidated text of Law 5/2015 before sizing the transaction.
Authorization
Authorization: Article 27
CNMV, six months and deemed approval by silence. With the fine print on requests to remedy deficiencies.
| Item | Rules |
|---|---|
| Competent authority | Spanish National Securities Market Commission (CNMV) |
| Time limit for a decision | Six months from receipt of the application |
| Administrative silence | Positive: the application may be deemed approved |
| Draft bylaws | With the exclusive corporate purpose and the reserved name |
| Explanatory report | Description of the project and of the planned activity |
| Directors | Details of the persons who will sit on the management body |
| Significant shareholders | Identity of the persons who will hold a qualifying holding |
| Additional documentation | As determined by the CNMV |
| Registration | Entry in the CNMV register of SGFTs |
The six-month period turns setting up an SGFT into a timing decision: any securitization transaction that depends on a newly created management company must be planned around that benchmark. The usual alternative is to hire the services of an already authorized management company.
The name is reserved
Article 28 reserves the expression “Sociedad Gestora de Fondos de Titulización” and the abbreviation SGFT for entities that have obtained the required CNMV authorization. It is not a decoration of the trade name: it is a reserved activity.
Six months are not six months
The period runs from receipt of the application, but requests to remedy deficiencies stop the clock. An incomplete application does not speed anything up: it stretches the real timeline far beyond the legal time limit.
Functions
What the management company does
Seven functions. The fourth is the one that defines its liability regime.
| Function | Content | Where the risk lies |
|---|---|---|
| Setting up | Executing the fund’s deed of constitution and defining its structure | The structure is fixed at birth: design errors are very expensive to correct later. |
| Administration and management | Administering and managing the assets pooled in the fund | This is the ongoing function: it lasts for the fund’s entire life. |
| Legal representation | Representing the fund vis-à-vis third parties, since it has no legal personality | The management company acts on behalf of a pool of assets that cannot act on its own. |
| Protecting holders | Acting diligently and in defense of the interests of the holders of the securities issued | This is the cornerstone of the management company’s liability |
| Risk assessment | Assessing the risk of the assets added to the fund | It determines the quality of the issue and the information investors receive. |
| Transparency | Drafting the prospectuses with the required information and maintaining transparency | A common source of liability to investors. |
| Record-keeping | Keeping a record of transactions for five years | A period specific to Law 5/2015, different from that of other documentation obligations. |
The combination of administration, representation and the duty of diligence toward holders puts the management company in a fiduciary position: it manages assets belonging to others in the interest of third parties, and is liable for doing so.
Comparison
SGFT, SGIIC and SGEIC
Same supervisor, three different regimes and a radically different managed vehicle.
| Item | SGFT | SGIIC | SGEIC |
|---|---|---|---|
| What it manages | Securitization funds and bank asset funds | Collective investment schemes | Closed-ended collective investment entities |
| Legislation | Law 5/2015, Arts. 25–33 | Law 35/2003 on Collective Investment Schemes | Law 22/2014 on venture capital entities |
| Authorized by | CNMV | CNMV | CNMV |
| Minimum capital | €1,000,000 | Under its own regime | Under its own regime |
| Corporate purpose | Exclusive | Exclusive, with complementary activities | Exclusive, with complementary activities |
| Managed vehicle | No legal personality | Funds without legal personality, or companies | Funds or companies |
| Reserved name | Yes (Art. 28) | Yes | Yes |
| Authorization period | Six months | Under its own regime | Under its own regime |
The three are often confused because they share a supervisor and a logic. The essential difference is the vehicle: the SGFT manages separate pools of assets without legal personality, set up to isolate assets, not collective investment vehicles.
Use cases
Why securitization funds are set up
Securitization is a financing and risk transfer technique, not a product in itself.
Risk
Transfer and isolation
“The separate pool of assets isolates the assets from the originator’s insolvency risk, which is the core legal effect of the transaction.”
Portfolios
Securitization of acquired portfolios
“When the asset comes from a portfolio purchase, the structure relies on the prior assignment and its documentation.”
Businesses
Non-bank financing
“Law 5/2015 was enacted precisely to diversify business financing sources beyond bank lending.”
Consequences
Liability of the management company
Managing a pool of assets without legal personality in the interest of third parties has its own regime.
The management company is liable to holders. The duty to act diligently and in defense of their interests is the cornerstone of the regime: the position is fiduciary, not merely administrative.
The prospectus is a source of liability. The management company drafts the information investors use to decide, and is liable for its accuracy.
And the exclusive purpose leaves no room for improvisation. Any activity outside Article 25(1) goes beyond the corporate purpose of an authorized entity, with all the consequences that entails.
| Severity | Amount | Basis or alternative |
|---|---|---|
| Share capital | €1,000,000 | Fully paid up in cash and represented by registered shares. |
| Additional own funds | 0.02% | On the book value of managed assets in excess of €250 million. |
| Combined cap | €5,000,000 | Maximum limit on the sum of own funds and the additional amount required. |
Set up your own management company or hire an existing one?
Six months, €1 million of capital and an exclusive corporate purpose. We analyze whether your transaction justifies your own management company or whether you are better off relying on one that is already authorized.
Frequently asked questions
Securitization fund management company: common questions
What is a securitization fund management company?
A public limited company authorized by the CNMV whose exclusive corporate purpose is the setting up, administration and legal representation of securitization funds and bank asset funds. It is governed by Articles 25–33 of Law 5/2015 of April 27.
Why is a management company needed?
Because a securitization fund is a separate pool of assets without legal personality. As it is not a legal person, it cannot set itself up, enter into contracts or appear before courts or authorities. The management company fills that gap: it sets the fund up, administers it and represents it vis-à-vis third parties.
What is the minimum capital?
€1,000,000, fully paid up in cash and represented by registered shares. On top of that, there is an additional own funds requirement of 0.02% of the book value of the managed funds’ assets in excess of €250 million, with a combined cap of €5 million.
How long does authorization take?
Article 27(1) sets a time limit of six months from receipt of the application, and the application may be deemed approved if there is no decision in time. In practice, the real timeline depends on requests to remedy deficiencies, which stop the clock: a well-prepared application is the only way to make the legal time limit resemble the real one.
Can the management company do anything else?
No. Its corporate purpose must be exclusively the one set out in Article 25(1). If the project needs to combine managing securitizations with another activity, the solution lies in the group’s corporate structure, not in widening the management company’s purpose.
Can I call my company an SGFT without being authorized?
No. Article 28 reserves the name “Sociedad Gestora de Fondos de Titulización” and its abbreviation for entities authorized by the CNMV. It is a reserved activity, with all that this entails.
Can it manage funds set up abroad?
Yes. The law allows SGFTs to manage funds similar to securitization funds set up in other countries, on the terms provided by law. How this fits with the rules of the country where the fund was set up should be analyzed case by case.
How long must records be kept?
Five years for the record of transactions, under Law 5/2015. This period is specific to that law and should not be confused with the AML/CFT record-keeping period, which is ten years and serves a different purpose.
What liability does the management company take on toward investors?
The law requires it to act diligently and in defense of the interests of the holders of the securities issued by the fund. That position, together with its role in drafting the prospectus and assessing the risk of the assets, places the management company in a fiduciary position and is the main source of exposure in the project.
Is it the same as an SGIIC?
No. An SGIIC manages collective investment schemes and is governed by its own law. An SGFT manages separate pools of assets set up to isolate assets and issue securities backed by them. They share a supervisor and an authorization logic, but the managed vehicle and the regime are different.
Is it worth setting up your own management company?
It depends on volume and frequency. For a one-off transaction, it is usually more efficient to rely on an already authorized management company: you avoid the €1 million of capital, the six-month time limit and the permanent organizational structure. For a recurring securitization program, your own management company starts to make sense in terms of economics and control.
Practical guide
Practical guide to setting up an SGFT
Six months and €1 million of capital make this a structural decision, not a formality.
First: your own management company?
For a one-off transaction, it is almost never worth it. For a recurring program, it almost always is. That question comes before any application.
The exclusive purpose rules
If the group needs other activities, this has to be solved in the corporate structure before incorporation, not afterward.
And complete from the start
Requests to remedy deficiencies stop the clock. A complete application is the only thing that makes six months mean six months.
SGFT incorporation checklist in 10 steps
- Decide whether the project justifies your own management company or whether it is better to hire an already authorized one.
- Design the group’s corporate structure, bearing in mind that the management company’s purpose will be exclusive.
- Size the capital: €1 million, paid up in cash and represented by registered shares.
- Project the additional own funds based on the volume of assets you expect to manage.
- Draft the bylaws with the Article 25(1) purpose and the reserved name.
- Prepare the explanatory report and the planned program of activities.
- Gather the fit and proper documentation for the directors and the identity of the significant shareholders.
- Design the internal organization: prevention of conflicts of interest and the regulatory compliance function.
- Define the transaction record system and its five-year retention.
- File the complete application with the CNMV and plan the project around the six-month time limit.
If what you need is the structure of the transaction rather than the management company, start with loan securitization or buying and selling portfolios.
The project in practice
The four decisions that shape a securitization
The management company is one piece of the project, not the project. These are the decisions that come before and after it.
1) VehicleOwn or third-party management company
€1 million of capital, six months and a permanent structure, versus hiring an existing management company. For a single transaction, the answer is almost always the latter.
- Program recurrence
- Control of the structure
- Opportunity cost
2) AssetWhat is securitized and how it is transferred
Transferring the receivables to the fund is the act that achieves isolation. Its documentation is the legal core of the transaction.
- Assignment of receivables
- Notification
- Risk isolation
3) IssueTranches, prospectus and placement
The management company drafts the prospectus and is liable for its content. This is where exposure to investors is concentrated.
- Tranche structure
- Prospectus
- Periodic reporting
4) Life of the fundOngoing administration
The role does not end with the issue. The management company administers, reports and represents throughout the fund’s life, with a duty of diligence toward holders.
Tip: the real cost of your own management company lies not in setting it up but in the permanent structure that must be maintained throughout the life of the managed funds.
Quick decisionPractical map: do I need my own management company?
Three scenarios and the reasonable answer.
Single transaction
Existing management company. The €1 million and the six months do not pay off.
Recurring program
Own management company. Control of the structure and economies of scale.
Funds abroad
Analyze: the SGFT can manage similar foreign funds.
SGFT playbook
Setting up an SGFT in practice
Form and capital
Public limited company formed by simultaneous incorporation, with €1 million of capital paid up in cash.
Deed of incorporation and evidence of payment.
Purpose and name
Exclusive purpose under Article 25(1) and a name that includes the reserved expression.
Draft bylaws.
Report and activities
Description of the project and of the planned activity.
Explanatory report and program of activities.
Governance
Fit and proper assessment of directors and identity of significant shareholders.
Good repute documentation and shareholding structure.
Organization
Administrative and organizational measures, conflicts of interest and compliance.
Organization manual and conflicts of interest policy.
Records
Transaction record system with five-year retention.
Archiving procedure and supporting documents.
Signs that the project is not ready to file
Any of these stretches the real timeline far beyond the six months set by law.
- The planned corporate purpose includes activities outside Article 25(1).
- The capital is not fully paid up in cash.
- There is no fit and proper documentation for the proposed directors.
- The shareholding structure does not clearly identify the ultimate owner.
- There is no conflicts of interest policy and no defined compliance function.
Working glossary
Key securitization concepts
Terms that appear in Law 5/2015, in prospectuses and in transaction documents.
SGFTBasics
Securitization fund management company
Public limited company authorized by the CNMV that sets up, administers and represents the funds.
Arts. 25–33 of Law 5/2015.
FundVehicle
Securitization fund
Separate pool of assets without legal personality, made up of the transferred assets and the securities issued.
See: loan securitization.
€1,000,000Capital
Minimum share capital
Fully paid up in cash and represented by registered shares.
Art. 29 of Law 5/2015.
0.02%Own funds
Additional amount
On the book value of managed assets in excess of €250 million.
Combined cap of €5 million.
Art. 25(1)Purpose
Exclusive corporate purpose
Setting up, administration and legal representation of securitization funds.
No ancillary activity allowed.
Art. 27Procedure
CNMV authorization
Six-month time limit from receipt of the application, with deemed approval by administrative silence.
Requests to remedy deficiencies stop the clock.
Art. 28Reservation
Reserved name
The term SGFT is reserved for authorized entities.
Reserved activity.
TransferAct
Transfer of the assets
Transfer of the receivables to the fund. This is what isolates the risk.
ProspectusIssue
Disclosure document
The management company drafts it and is liable to investors for its content.
See: prospectus.
COMPLIANCE CONTROL CENTER · SECURITIZATION
Decision matrix: how to structure the transaction
Cross the program’s recurrence with the expected volume. The cell shows the reasonable structure.
Structure matrix
Green: existing management company. Red: own management company justified.
Recurrence \ Volume
Low
Medium
High
Single transaction
Third-partyexisting manager
Third-partyexisting manager
Analyzecost-benefit
Occasional program
Third-partyexisting manager
Analyzecost-benefit
Owneconomies of scale
Recurring program
Analyzecost-benefit
Ownjustified
Own+ control
Related topics
The securitization ecosystem
The management company is one piece. These are the others involved in a transaction.
Structure
Loan securitization
The transaction itself: which assets are transferred, how the risk is isolated and which securities the fund issues.
See securitization →
TransferIssue
Portfolios
Buying and selling NPL portfolios
When the asset to be securitized comes from a prior purchase of a loan portfolio.
See NPL portfolios →
NPLDue diligence
Servicing
Servicing agreement
The operational administration of the transferred loans, distinct from managing the fund.
See servicing agreement →
ServicerCollections
Compare
SGIIC: IIC management company
The entity it is most often confused with: same supervisor, different vehicle and regime.
See SGIIC →
IICComparison
Common mistakes
The six mistakes that most delay an SGFT project
Almost all of them come down to treating a six-month authorization as a corporate formality.
Setting up a management company for a single transaction
€1 million of capital, six months and a permanent structure rarely pay off in a one-off transaction. Hiring an existing management company is usually the efficient route.
Corporate purpose with ancillary activities
Article 29 requires an exclusive purpose. Any addition means redoing the bylaws and restarting the clock.
Contributing capital in kind
The capital must be fully paid up in cash. Non-cash contributions are not allowed.
Forgetting the additional own funds
The 0.02% on managed assets above €250 million does not show up at incorporation, but it does when the business grows. Size it in the plan, not when it arrives.
Filing an incomplete application
Requests to remedy deficiencies stop the clock. A half-finished application does not bring the timeline forward: it makes it soar.
Neglecting internal organization
Conflicts of interest and regulatory compliance are an Article 29 requirement, not filler documentation. This is the block that raises the most questions.
Official sources
Where all of the above comes from
All the information comes from the consolidated text of Law 5/2015 published in the BOE and from the CNMV’s procedures documentation.
BOE
Law 5/2015 of April 27
Promotion of business financing. Title III: securitization funds and management companies (Arts. 25–33).
CNMVAuthorization and registration procedure for entities
CNMV procedures document on the authorization and registration of supervised entities.
CNMVSpanish National Securities Market Commission (CNMV)
The authority competent to authorize and register securitization fund management companies.
BOELaw 6/2023 of March 17
Securities Markets and Investment Services: the general framework of the market in which the fund’s securities are issued.
BOELaw 35/2003 of November 4
Collective investment schemes: the reference rules for calculating own funds.
EUR-LexRegulation (EU) 2017/2402
European securitization framework: general requirements and simple, transparent and standardized securitizations.
Initial publication. Requirements checked against the consolidated text of Law 5/2015.
Planned review: developments in the European securitization framework and in the specific rules set by the CNMV.
Contact
Book a call
Tell us what you want to securitize, how often, and whether you need your own management company.
Regulatory framework for securitization fund management companies
Securitization fund management companies (SGFTs) are governed by Articles 25–33 of Law 5/2015 of April 27 on the Promotion of Business Financing, within its Title III. Under Article 25(1), their corporate purpose is the setting up, administration and legal representation of securitization funds and bank asset funds, and they may also manage similar funds set up abroad.
Why the fund needs a management company
A securitization fund is a separate pool of assets without legal personality. That feature, which is precisely what makes it possible to isolate the transferred assets from the originator’s insolvency risk, prevents the fund from acting on its own in legal dealings. The management company fills that gap: it executes the deed of constitution, administers the pooled assets and holds the fund’s legal representation vis-à-vis third parties throughout its life.
Article 29 requirements
The management company must be set up as a public limited company through simultaneous incorporation, with indefinite duration, a registered office in Spain and a corporate purpose limited exclusively to the one set out in Article 25(1). The minimum share capital is €1,000,000, fully paid up in cash and represented by registered shares. On top of that, there is an additional own funds requirement equal to 0.02% of the book value of the managed funds’ assets in excess of €250 million, with a combined limit of €5 million. The provision also requires adequate administrative and organizational measures, including the prevention of conflicts of interest and the regulatory compliance function.
Authorization and reserved name
Authorization is granted by the Spanish National Securities Market Commission (CNMV), which must decide within six months of receiving the application; if it does not, the application may be deemed approved. The application includes the draft bylaws, the explanatory report, details of the directors, the identity of significant shareholders and any additional documentation the CNMV itself may require. Article 28 reserves the name “Sociedad Gestora de Fondos de Titulización” and its abbreviation SGFT for entities that have obtained the required authorization, making the activity a reserved one.
The fiduciary position of the management company
Among the functions the law assigns to the management company, the duty to act diligently and in defense of the interests of the holders of the securities issued by the fund stands out. Added to this are assessing the risk of the assets added to the fund, drafting the prospectus with the required information and keeping a record of transactions for five years. Taken together, this puts the management company in a fiduciary position: it manages assets belonging to others in the interest of third parties and is liable for doing so, which is the main source of exposure in any securitization project. For non-recurring transactions, it is worth seriously considering the alternative of relying on an already authorized management company, since the capital, the six-month time limit and the permanent organizational structure rarely pay off in a single issue. You can see the transaction as a whole in loan securitization.
Securitization
Authorization and markets
Official sources
Key legislation, linked to the official text:
- Law 5/2015 of April 27 on the Promotion of Business FinancingBOE · consolidated text
- Law 35/2003 of November 4 on Collective Investment SchemesBOE · consolidated text
- Law 22/2014 of November 12, regulating venture capital entities, other closed-ended collective investment entities and management companies of closed-ended collective investment entitiesBOE · consolidated text
Legislation and links reviewed in .