ECB leaves investors guessing on CRD compliance

By Bill Thornhill
07 Aug 2014

Covered bond bankers are increasingly fielding calls from mainly German banks who want to know whether their covered bond investments are compliant with Article 129 of the Capital Requirements Directive (CRD). The process has become more challenging recently, because the European Central Bank will no longer provide this information.

Whether a covered bond is compliant with Article 129 of the CRD determines how covered bonds are treated in large exposure rules, bank liquidity buffers, and whether banks can provide swaps on their covered bonds outside central clearing.

The CRD definition of covered bonds deals with technical ...

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