Operational overdrafts on cash accounts

Question

Most of our clients have funds in custody with us. Owing to their constant selling and buying of securities, they sometimes incur overdrafts on their cash accounts with us as a result of mismatches between the settlement dates of the various securities. Those overdrafts are operational in nature and last between one and five days. Can you confirm that such overdrafts are subject to AnaCredit reporting? We will be reporting all clients for which we have confirmed overdrafts in place (whether committed or uncommitted), but are operational overdrafts excluded if they last five days or less?

Answer

Please note that unauthorised overdrafts, referred to as “current accounts which are not associated with an agreed credit limit”, are described in Part II of the AnaCredit Manual (see Section 3.4.1, pages 24-25).

Unauthorised overdrafts (i.e. accounts that are in debit on the reporting reference date) should be reported to AnaCredit where the debtor’s commitment amount vis à vis the observed agent exceeds €25,000. The fact that such debit balances only last for short periods of time is irrelevant. However, unauthorised overdrafts are not subject to reporting where the balance is not in debit on the reporting reference date itself.

Related questions

See also Counterparty reference data relating to unauthorised debit balances

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