Capital relief refers to a reduction in the amount of capital that a bank or other financial institution is required to hold. Capital relief can be provided by governments or regulators, and it can be used to encourage banks to make
loans and investments.
There are a number of ways that capital relief can be provided. One way is to allow banks to use
securitizations to reduce their capital requirements. Securitizations are a type of financial transaction in which banks
pool together loans and other
assets and sell them to investors. By selling these assets, banks can reduce their balance sheets and their capital requirements.