The proposed draft RTS set out in more detail the additional criteria to those envisaged at domestic level that institutions within a group or within an institutional protection scheme (IPS) need to meet in order to be able to apply higher inflows and/or lower outflows on liquidity and credit facilities on cross-border transactions. These criteria, as already specified in the LCR Delegated Act, aim at ensuring the effectiveness of the liquidity support.
In particular, these draft RTS specify how the liquidity provider and receiver shall present a low liquidity risk profile. The liquidity provider shall monitor and oversee the liquidity position of the receiver at least on a daily basis and its contingency funding plan shall ensure through this monitoring that the support to the receiver is guaranteed even in times of stress.
In addition, the draft standards detail the necessary legally binding agreements and commitments between group entities regarding the credit or liquidity line.
Comments can be sent to the European Banking Authority (EBA) by 13 January 2016. A public hearing for the consultation will take place at the EBA premises on 18 December 2015 from 10:00 to 12:00 UK time.
Press release
Consultation paper
© EBA
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