ECB changing acceptable collateral framework

ECB amends monetary policy implementation guidelines

  • ECB phasing out secured marketable assets other than asset-backed securities, legislative covered bonds and multi-cédulas as collateral
  • Application process and acceptance criteria for external credit assessment institutions clarified
  • Amendments to treatment of breaches with respect to own fund requirements and reporting on capital ratios

The European Central Bank (ECB) has today published amendments to its guidelines on the implementation of monetary policy in the Eurosystem, applicable from 1 January 2021.

The amended guidelines implement a decision taken by the Governing Council on 13 December 2019 whereby secured marketable assets other than asset-backed securities and covered bonds would no longer be accepted as Eurosystem collateral. Under the amended guidelines, the ECB will also phase out non-legislative covered bonds (i.e. contractual covered bonds) from the Eurosystem collateral framework. This means that by 1 January 2021 all covered bonds remaining in the collateral framework will be legislative covered bonds or multi-cédulas.

The guidelines also clarify the application process and acceptance criteria for external credit assessment institutions in the Eurosystem credit assessment framework.

They furthermore amend the Eurosystem monetary policy counterparty framework with respect to the treatment of confirmed breaches of minimum own funds requirements and breaches of the obligation to report information on capital ratios within the required deadlines.

Guidelines ECB/2020/45, ECB/2020/46, ECB/2020/47 and Decision ECB/2020/48 are available on the ECB’s website and will be published in 23 official EU languages in the Official Journal of the European Union.

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