---
kind: "section"
citation: "12 C.F.R. § 1234.3"
title: "12"
number: "1234.3"
heading: "Base risk retention requirement."
url: "https://uscodex.org/cfr/12/1234.3"
---

# §1234.3. Base risk retention requirement.

- (a) **Base risk retention requirement.** Except as otherwise provided in this part, the sponsor of a securitization transaction (or majority-owned affiliate of the sponsor) shall retain an economic interest in the credit risk of the securitized assets in accordance with any one of [§§ 1234.4 through 1234.10](/cfr/12/1234.4..1234.10.md). Credit risk in securitized assets required to be retained and held by any person for purposes of compliance with this part, whether a sponsor, an originator, an originator-seller, or a third-party purchaser, except as otherwise provided in this part, may be acquired and held by any of such person's majority-owned affiliates (other than an issuing entity).
- (b) **Multiple sponsors.** If there is more than one sponsor of a securitization transaction, it shall be the responsibility of each sponsor to ensure that at least one of the sponsors of the securitization transaction (or at least one of their majority-owned or wholly-owned affiliates, as applicable) retains an economic interest in the credit risk of the securitized assets in accordance with any one of §§ [1234.4](/cfr/12/1234.4.md), [1234.5](/cfr/12/1234.5.md), [1234.8](/cfr/12/1234.8.md), [1234.9](/cfr/12/1234.9.md), or [1234.10](/cfr/12/1234.10.md).

## Notes

### Authority

Authority: 12 U.S.C. 4511(b), 4526, 4617; 15 U.S.C. 78o-11(b)(2).

### Source

Source: 79 FR 77740, Dec. 24, 2014, unless otherwise noted.