LCR amendment could disrupt Lux covereds

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By Bill Thornhill
03 Aug 2020

The European Commission’s proposed amendment to the Liquidity Coverage Ratio Delegated Act suggests covered bonds, such as those issued by NordLB Luxembourg and others, could be excluded, which could extinguish banks’ demand for them. However, it is likely that a solution referencing the covered bond directive will be found.

The Commission in the process of updating the liquid covered ratio (LCR) to improve the efficiency of covered bond funding, so issuers will now be able to count 30 day liquidity held within their covered bond programme towards their LCRs as well.

Alongside a number of other technical ...

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