ECB allows private covered bonds as repo collateral

ECB Building 230x150
By Owen Sanderson
07 Sep 2015

The European Central Bank amended its collateral rules last week to allow banks to post non-marketable collateral for its regular monetary operations, as long as it is packaged in covered bond-style dual recourse instruments.

The Eurosystem will now allow “eligible non-marketable assets… namely, non-marketable debt instruments backed by eligible credit claims”.

It defines these as offering dual recourse to an originating credit institution, featuring a dynamic covered pool, and no tranching of risk.

This definition is the same concept as a ...

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