ECB integrates non-financial credit claims into collateral framework
The European Central Bank has decided to permanently integrate portfolios of non-financial corporate credit claims into its general collateral framework. This move marks the final step in phasing out temporary crisis-era collateral easing measures.
Harmonizing collateral eligibility
The Governing Council of the European Central Bank (ECB) has decided on the eligibility criteria and risk control framework to permanently integrate portfolios of non-financial corporate (NFC) credit claims into its general collateral framework.
This follows an initial announcement in November 2024 to phase out temporary collateral measures and marks the final step in discontinuing the temporary additional credit claim (ACC) framework.
NFC credit claims are loans banks grant to non-financial firms, grouped as a package for liquidity.
Eligibility criteria for these portfolios will be mostly harmonised with individual credit claims, but with acceptance of a broader range of credit quality steps, provided diversification criteria are met.
The risk control framework includes valuation haircuts and concentration limits to ensure equivalent risk levels.
Return to a single collateral list
Until technical implementation, existing portfolios of NFC credit claims will continue to be accepted under the temporary framework.
However, credit claims benefiting from COVID-19-related public sector guarantees under the temporary framework will only remain eligible until the end of 2026, unless they meet all general framework requirements.
National central banks retain the option to terminate their temporary ACC frameworks earlier.
Today's decision signifies a return to a single list of eligible collateral across the euro area, reducing complexity and ensuring a level playing field for all credit institutions.
Technical implementation is currently planned for November 2027 at the earliest.
Ending crisis-era exceptions
This decision marks a significant step in normalizing the Eurosystem's collateral framework, reflecting the ECB's confidence in financial stability.
It streamlines operational procedures and ensures a consistent, risk-controlled approach to collateral across the euro area.
For banks, this means a clearer, more stable framework, though some adaptation to new requirements will be necessary.