EBA · 2021_5700 Rejected question

Secured lending

Regulation
Regulation (EU) No 575/2013 (CRR)
Article
192, para. 2
Topic
Supervisory reporting - Liquidity (LCR, NSFR, AMM)
Submitted by
Credit institution
Submitted
2021-01-26

Question

Should mortgage loans be classified as secured lending in the LCR reports?

Background

In the LCR inflow report (template 74) the inflow <30 days from "secured lending and capital market-driven transactions” has to be reported in section 1.2. On row 345, ID 1.2.2.3.3 all inflow <30 days related to secured lending to non-central banks with all other non-liquid collateral has to be reported. The instructions to this template (Annex 25) refer to article 192 (2) for the definition of secured lending. According to article 192 (2) of CRR2 all secured loans should be qualified as "secured lending" as long as there is no right to receive margin at least daily, so also mortgage loans would qualify as “secured lending”. However reporting all collateralized loans including mortgage loans on row 345 seems not to be in line with the setup of template 74 where secured lending seems to be more related to securities finance or repo-like transactions. Also In the BIS regulations secured lending is explicitly only related to securities finance and repo-like transactions with tradable assets as collateral. So the question is should regular collateralized loans like mortgage loans be reported as “secured lending and capital market-driven transactions with all other non-liquid collateral”?
No answer published yet.

Original source: European Banking Authority, Q&A ID 2021_5700

This Q&A is published by European Banking Authority and is non-binding. It does not constitute legal advice. Updated weekly from official ESA sources.

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