Question ID
2015_2486
Legal act
Regulation (EU) No 575/2013 (CRR)
Topic
Liquidity risk
Article
416
Paragraph
1
Subparagraph
(c)(ii)
COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations
Delegated Regulation (EU) 2015/62 - DR with regard to the leverage ratio
Article/Paragraph
12.1.d; 14 a-f
Type of submitter
Credit institution
Subject matter
Inclusion of loans that have been pre-positioned with central banks but are not encumbered in the numerator of the LCR
Question

Since loans that have been pre-positioned with Central Banks and are not encumbered can be used to raise liquidity from the Central Bank, could they be considered as 2B level assets even though no commitment fee has to be paid?

Background on the question

According to the Article 12 of the Delegated Regulation (EU) 2015/61 it is possible to consider as 2b level assets those restricted-use committed liquidity facilities that may be provided by the ECB, the Central Bank of a Member State or a third country , provided that the requirements laid down in the Article 14 are met.

The mentioned Article (14) establishes the requirements that the restricted-use committed liquidity facilities must fulfill (A-F) in order to be considered level 2b assets. In that sense, it can be considered that the only requirement not met is the one exposed in the letter A that states that the facility must be subject to a commitment fee on the total committed amount during a non-stress period.

Based on the fact that the assets pre-positioned in a Central Bank constitute a credit facility, it can be assumed that the entity complies with the rest of the requirements of Article 14. If the loans are included in that pool of assets, the requirements can be considered met.

Submission date
Final publishing date
Final answer

According to Article 12 of the Delegated Regulation (EU) 2015/61 in order to qualify as level 2B assets, the restricted-use committed liquidity facilities that may be provided by a Central Bank shall fulfil all of the criteria of Article 14. Therefore, unencumbered assets that can be used to raise liquidity from Central Bank shall not to be considered automatically as the restricted-use committed liquidity facilities.

Status
Final Q&A
Answer prepared by
Answer prepared by the EBA.
Note to Q&A

Update 26.03.2021: This Q&A has been reviewed in the light of the changes introduced to Regulation (EU) No 575/2013 (CRR) and continues to be relevant.

Disclaimer

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