Rules update 16 April 2018

The Bank of Finland has updated its rules on monetary policy operations and collateral to include the ECB’s amendments to the General Documentation Guideline (ECB/2018/3), the Guideline on the valuation haircuts applied in the implementation of the Eurosystem monetary policy framework (ECB/2018/4) and the Guideline on additional temporary measures relating to Eurosystem refinancing operations and eligibility of collateral (ECB/2018/5).

As a result of the updates, assets with floating coupons will be subject to maturity-based haircut categories. For own-used covered bonds with the right to extend the maturity date, the valuation haircut is to be calculated on the basis of the latest possible maturity date. The updated requirements are valid as of 16 April 2018.

With respect to non-marketable credit claims, the ECB has also specified the coupon structures approved by the Eurosystem. The updated requirements are valid as of 1 October 2018.

Counterparties that use credit claims as collateral are required to make, by no later than 30 April 2019, a contractual agreement consenting to the disclosure of confidential information with debtors of credit claims used as collateral. In pledging new credit claims as collateral, this requirement must be fulfilled as of 16 April 2018. In addition, the updated Bank of Finland rules now contain more detailed guidance on the pledging of syndicated loan shares.

See Bank of Finland Rules for counterparties and customers