Posts Tagged ‘ Liquidity Coverage Ratio ’

Issuer ratings out, Art 129(7) added in new LCR draft leak

Jul 24th, 2014
Drapeaux européens devant le Berlaymont

Issuer ratings look set to have been scrapped as LCR eligibility criteria for covered bonds and a transparency requirement introduced, according to a leaked EC document on the delegated act that the Commission is likely to finalise in September.

Danes laud leaked Commission paper with covered in Level 1

May 16th, 2014
AppMargrethe Vestager_1

A leaked document by European Commission staff circulating this week confirms statements from two Danish ministries last Friday that certain large, highly rated covered bonds will be eligible as Level 1 assets for Liquidity Coverage Ratio purposes, albeit with an overall cap of 70% and a haircut of 7%.

2A+ status and higher limit seen as likely LCR result from Commission

May 8th, 2014

The EC is steering toward keeping covered bonds as Level 2 assets for LCR purposes but allowing them to make up a larger share, according to sources, and an EC spokesperson said “talks are progressing well” about a solution addressing Danish concerns.

MPs send Barnier latest salvo as Danish detail ARMs plans

Jan 23rd, 2014
Karin Gaardsted, MP

Danish mortgage banks have begun announcing their plans for the forthcoming auction season of more than Dkr200bn (Eu26.8bn) of ARMs bond sales, while Danish MPs launched the latest salvo in the ongoing battle for covered bonds to be included as Level 1 assets in LCRs.

EC stresses EU-specific factors to raise Level 1 LCR hopes

Jan 16th, 2014
Press conference by Michel Barnier

The European Commission will take into account “features specific to the EU banking system and financial markets” in addition to European Banking Authority (EBA) reports and international standards when deciding on covered bonds’ status in the LCRs, according to an EC spokesperson.

EBA recommends against Level 1 for covered

Jan 9th, 2014
EBA image

The European Banking Authority (EBA) has excluded covered bonds from assets it has recommended should be eligible as extremely high quality liquid assets for Liquidity Coverage Ratio (LCR) purposes in a report to the European Commission.

EBA says LCR Level 2 only for covered: Does it actually matter for euro markets?

Jan 9th, 2014

The EBA on 20 December published its final recommendations on the Liquidity Coverage Ratio (LCR), which exclude covered bonds from Level 1 status. Crédit Agricole CIB’s Florian Eichert takes a closer look at the potential implications, and sees investor behaviour only really changing in response to a lower minimum rating criterion.