Regulatory Alerts2020-04-07
A circular dated April 7, 2020 amending the decision issued regarding the rules regulating the credit registration system at the Central Bank
The European Central Bank (ECB) has presented a new set of rules to ease restrictions on non-bank lending institutions. These changes will apply to investment firms, money market funds, and venture capital companies that are not considered significant institutions by the bank. The measures include raising the threshold for non-bank entities' investment in covered bonds from EUR 5 million to EUR 10 million and removing the need for prior approval of investment-grade corporate securities held directly or indirectly for portfolio management purposes. Moreover, the ECB will postpone supervisory reporting requirements for banks until March 31, 2020, for non-bank entities with deposits exceeding €10 million that have been granted temporary funding by the European Central Bank due to market turmoil caused by the COVID-19 pandemic. Finally, it's announced that these rules will apply from January 8, 2020, until March 31, 2020, and could be extended based on market conditions. The chairman of the ECB, Christine Lagarde, said: "These measures are designed to ensure that non-banking institutions continue to provide funding, especially during these uncertain times".