The European Central Bank (ECB) is gradually phasing out the support measures it introduced for banks because of the Corona crisis.
The easing of regulations for collateral that financial institutions provide for receiving central bank loans are to be withdrawn in three steps from July until March 2024, the euro central bank announced on Thursday.
With the measures taken in spring 2020, she wanted to ensure that there would be no credit crunch in the wake of the pandemic and that sufficient collateral would continue to be available.
According to the ECB, the gradual expiry of the relief will give the banks in the euro area enough time to adapt.
Beginning in July, among other things, the valuation discounts on the collateral submitted by the financial institutions are to be increased again.
In addition, collateral that met the minimum credit quality requirements by April 7, 2020, but whose rating then fell below this threshold, will no longer be accepted in the future.
However, Greek government bonds that do not meet the quality requirements should continue to be accepted as collateral.
This should be maintained at least as long as expiring bonds are replaced again as part of the PEPP pandemic bond purchase program.