Question ID:
Legal Act:
Regulation (EU) No 575/2013 (CRR)
Liquidity risk
422 and 425
COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations:
Delegated Regulation (EU) 2015/61 - DR with regard to liquidity coverage requirement
Art. 28, paragraph 3 and Art. 32, paragraph 3 and 4
Disclose name of institution / entity:
Type of submitter:
Competent authority
Subject Matter:
Scope of application of the secured lending regime for liquidity coverage requirement - non-financial customers

(i) Are loans secured by collaterals such as debt securities, equities, mortgages or movable property to be considered as secured lending pursuant to Article 28, paragraph 3 and Article 32, paragraph 3 and 4 of Delegated Regulation (EU) 2015/61? Those articles only refer to “secured lending […] transactions as defined in points 2 […] of Article 192 of Regulation (EU) N°575/2013” which defines “secured lending transactions” as “any transaction giving rise to an exposure secured by collateral which does not include a provision conferring upon the institution the right to receive margin at least daily”. (ii) What is the applicable inflow rate to monies due from those transactions, when those are provided to non-financial customers and when the collaterals provided are not reusable except in case of default of the borrower? Is it 100% as for secured lending transactions pursuant to Article 32 para. 3 (b) of delegated Regulation (EU) 2015/61 or 50% as for monies due from non-financial customers pursuant to Article 32 para. 3 (a) of the same Regulation?

Background on the question:

CRR Part VI and DR on LCR refer to secured lending transactions as defined in Article 192 (2) CRR for liquidity coverage requirement purposes, without restriction on the collateral eligible or the type of counterparties to consider a transaction to be “secured lending”. In the case of loans granted to non-financial clients, various collateral can be provided, such as debt securities issued by general government, securities, CIUs, mortgages and movable property. In the case where such collaterals are not reusable by the bank except in case of default of the borrower, they do not qualify as liquid assets.

Date of submission:
Published as Rejected Q&A
Rationale for rejection:

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Rejected question