The new guidelines amend the Guideline on the implementation of the Eurosystem monetary policy framework, the Guideline on the valuation haircuts applied in the implementation of the Eurosystem monetary policy framework and the Guideline on additional temporary measures relating to Eurosystem refinancing operations and eligibility of collateral.
Among the amendments to the monetary policy implementation framework is the further harmonisation of the definition of agencies as issuers or guarantors of debt instruments. In particular, the criteria used for recognised agencies in the collateral framework and agencies eligible for the public sector purchase programme (PSPP) are being aligned.
The Eurosystem is also incorporating the transparency requirements of the EU Securitisation Regulation (Regulation (EU) No 2017/2402) into its collateral framework. This decision was previously announced on 22 March 2019.
In addition, the Eurosystem is phasing out the use of rating tools from its general framework for monetary policy operations owing to cost-benefit considerations. Accepted rating tools may continue to be used until further notice only in the national central banks’ (NCBs) additional credit claims frameworks. The conditions applicable will be communicated by the NCBs to the currently accepted rating tools. Applications to become rating tools will no longer be considered.
Furthermore, the ECB is providing clarification on the treatment of credit claims in its collateral framework. In this context, the possibility of a theoretical valuation of credit claims is being removed from the general framework.
The ECB is also amending the criteria for own-use of covered bonds. From 1 February 2020, covered bonds must have an external credit assessment institution (ECAI) rating to be eligible for own-use.
Press release
© ECB - European Central Bank
Key
Hover over the blue highlighted
text to view the acronym meaning
Hover
over these icons for more information
Comments:
No Comments for this Article