(RTTNews) - Friday, the European Central Bank's Governing Council decided to amend the rating requirements for asset-backed securities to be eligible for use in Eurosystem credit operations.
According to an ECB press release, the Eurosystem will require at least two ratings from an accepted external credit assessment institution for all ABSs issued as of March 1, 2010. In determining the eligibility of these ABSs, the Eurosystem will apply the "second-best" rule, meaning that not only the best, but also the second-best available rating must comply with the minimum threshold applicable to ABSs. Further details in this regard is given in a press release dated January 20, 2009, the central bank said.
As of March 1, 2011, the second-best rule and the requirement to have at least two ratings will be applied to all ABSs, regardless of their date of issue, the ECB said.
"The Governing Council has deemed it necessary to introduce the above amendments to ensure that the Eurosystem's requirement of high credit standards for all eligible collateral is met," the central bank said. "In addition, the changes, which reflect recent market developments, aim to make a further contribution to restoring the proper functioning of the ABS market."
The list of external credit assessment institutions accepted by the Eurosystem is available on the ECB's website.
For comments and feedback: contact email@example.com Copyright(c) 2009 RTTNews.com, Inc. All Rights Reserved
updated Nov 20, 2009
Sign up to get our newsletter with money saving tips, travel hacks and more - no spam.
discounts & deals from all banks in one app?
At GET.com we compare credit cards and rate them objectively based on the credit card's features, interest rates and fees.
Cards are rated by our team based primarily on the basis of value for money to the cardholder. The GET.com team rates each card based on its annual fee, rewards, benefits, bonus, introductory APR, ongoing APR, flexibility (in how its benefits can be used and how rewards are earned and redeemed), and other card features.