European ABS under the microscope: A comprehensive overview of the asset class
Back
Article Type
Insights
Topic
Alternative Fixed Income
Published
March 24, 2026
Read time
11 mins
Authors
Peter Spijkman, CFA
Niek Swagers
PDF
Download
Share

Asset‑Backed Securities (ABS) have become an increasingly important component of the European fixed income landscape, offering investors a unique blend of diversification and attractive risk‑adjusted returns. In an environment defined by shifting interest rates and evolving regulatory frameworks, understanding the structure and behavior of ABS is more relevant than ever. This paper provides a clear and comprehensive overview of the asset class, outlining its mechanics, opportunities, and key risks for professional investors.  

 

Introduction

ABS are bonds (‘securities’) that are covered (‘backed’) by a specific collateral (a pool of ‘assets’), hence ‘asset-backed securities’. In general, the underlying pool of assets are loans from one category and one jurisdiction, for example residential mortgages in the United Kingdom, car loans in Germany, student loans in the United States or credit card loans in France. Pooling these loans together into an ABS enables the issuers (banks or other financial institutions) of these loans to access large scale funding in capital markets in a more cost-efficient manner than selling these underlying loans on a stand-alone basis. Furthermore, banks can manage the credit risk exposure on their balance sheet and free up capital for further lending activities. From an investor's perspective, loans pooled in an ABS provides greater diversification and provides liquidity in secondary markets, which is not the case for the loans on a stand-alone basis. In the following sections we dive into the structure, risks, characteristics and opportunities of the European ABS market. 

 

Download full report >

Important disclosures

Authors

Peter Spijkman
Senior Investment Strategist
Peter Spijkman, CFA, joined Aegon Asset Management in 2012. He is a senior  Investment Strategist, focused on providing advice to institutional clients on their strategic asset allocation given their investment objectives and risk attitude.
View profile
Niek Swagers
Head of Investment Solutions
Niek Swagers is Head of Investment Solutions. This team is responsible for advising pension funds, insurers and other institutional investors on their strategic investment strategy.
View profile
Related Articles
View all Aegon insights