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Following the adoption of the euro by Cyprus and Malta the list of eligible marketable assets has included since 1 January 2008 marketable assets located in Cyprus and Malta which fulfil the euro area-wide eligibility criteria for use in Eurosystem credit operations.
From 1 January 2008 onwards, the rating agency DBRS can be used as a new external credit assessment institution (ECAI) source within the Eurosystem credit assessment framework (ECAF) – see Section 6.3 of “The implementation of monetary policy in the euro area – General Documentation on Eurosystem monetary policy instruments and procedures”, en, ).
Ratings from DBRS can be used for the credit assessment of eligible issuers / debtors / guarantors from EEA or non-EEA G10 countries. The lowest DBRS rating grade meeting the Eurosystem’s minimum requirement for high credit standards has been set at AL for DBRS’s long-term ratings and at R-1L for its short-term ratings, subject to regular review (see also: Harmonised rating scale).
The Governing Council of the European Central Bank (ECB) has adopted Guideline ECB/2007/10, amending Guideline ECB/2000/7 on monetary policy instruments and procedures of the Eurosystem. The amendments pertain to:
The amendments mainly take account of recent decisions by the Governing Council and relate, in particular, to the following four topics: monetary policy, eligible assets, Target2 and Euro area enlargement.
For details, see the press release
On 25 May 2007 the Governing Council provided further details on the residence criteria for assets eligible as collateral for eurosystem credit operations. As a result of the completion of the single collateral framework on 1 January 2007, the Eurosystem has specified that, with the exception of international or supranational institutions, issuers of marketable assets eligible for Eurosystem credit operations must be established either in the European Economic Area (EEA) or in one of the four non-EEA G10 countries (Canada, Japan, Switzerland and the United States). Thus, assets issued after 1 January 2007 by entities domiciled outside the EEA or the non-EEA G10 countries are not eligible, irrespective of whether a guarantee by an entity established in the EEA is available. However, assets issued before 1 January 2007 will remain eligible until 31 December 2011 and will only become ineligible after that date.
For details, see the press release
On 25 May 2007, the Governing Council announced an amendment to the calendar for the phasing-out of marketable tier two assets eligible as collateral for Eurosystem credit operations. Marketable assets which have been issued prior to 31 May 2007 and are traded on non-regulated markets that currently fulfil the Eurosystem’s requirements for safety and accessibility, but not for transparency, will remain eligible until 31 December 2009 and will become ineligible thereafter.
For details, see the press release
On 22 February 2007 the Governing Council decided (as announced in the Other decisions taken by the Governing Council in February 2007) to treat covered bank bonds (i.e. bonds issued by credit institutions in accordance with the criteria set out in Article 22 (4) of the UCITS Directive) issued from 1 January 2008 in the same way as all other marketable assets within the Eurosystem credit assessment framework by subjecting them to the same rating requirements. Covered bank bonds issued before 1 January 2008 will continue to be assessed against the previously applied criterion until their maturity. According to this criterion, covered bank bonds are deemed to fulfil the Eurosystem high credit standards if they comply strictly with the criteria set out in Article 22 (4) of the UCITS Directive.
The change aims at streamlining and simplifying the collateral framework and does not impact on the eligibility of the covered bank bonds as these in general fulfil the rating requirements of the Eurosystem.
As stated in the current version of the General Documentation (September 2006 edition), the single framework for eligible assets came into effect on 1 January 2007 and has replaced the two-tier system.
For details, see the
Following the adoption of the euro by Slovenia the list of eligible marketable assets has included since 1 January 2007 marketable assets located in Slovenia which fulfil the euro area-wide eligibility criteria for use in Eurosystem credit operations.
Since 1 January 2007, international debt securities in global bearer form must, in order to be eligible, be issued in the form of New Global Notes (NGNs) and must be deposited with a Common Safekeeper (CSK) which is an ICSD or, if applicable, a CSD that fulfils the minimum standards established by the ECB. International debt securities in global bearer form that were issued in the form of Classical Global Notes (CGNs) prior to 1 January 2007 and fungible securities issued under the same ISIN code on or after that date will remain eligible until maturity.
For details, see the press release
In order to be eligible as collateral for Eurosystem credit operations, asset-backed securities (ABS) must comply with the eligibility criteria specified in section 6.2.1 of the General Documentation ( 1.1 MB, en).
For details, see the press release
Specifically for ABS, the General Documentation foresees four additional criteria:
The procedures to be followed for gaining eligibility for ABS are the same as for other assets and are described under "Eligibility assessment procedures"
