The European Central Bank has eased the collateral eligibility criteria, lowering the rating threshold for securities that can be accepted as collateral from banks receiving assistance from the ECB.
The central bank will lower the credit threshold for marketable and non-marketable assets from A- to BBB-, with the exception of asset-backed securities (ABS), for which the credit quality threshold of A- remains into force.
In addition, the ECB will accept the following assets as collateral:
-Debt instruments issued by credit institutions, including certificates of deposits, which are traded on certain non-regulated markets as specified by the ECB and which fulfil all other eligibility criteria. These instruments will be subject to a 5% haircut add-on.
-Subordinated marketable debt instruments, which are protected by an acceptable guarantee as specified in section 6.3.2 of the General Documentation and which fulfil all other eligibility criteria. These instruments will be subject to a haircut add-on of 10% and to a further 5% valuation markdown in case of theoretical valuation.
Subject to positive eligibility assessment, debt instruments issued by credit institutions which are traded on non-regulated markets, subordinated marketable debt instruments as well as the marketable assets meeting the new credit threshold will be included in the list of eligible marketable assets published and updated on a daily basis on the ECB’s website.