Amended terms and conditions for collateral at the Riksbank
The Executive Board of the Riksbank has adopted amended terms and conditions governing collateral for loans at the Riksbank. These amendments are in part a return to the provisions that applied prior to the financial crisis and aim to reduce the Riksbank's credit risk.
The Riksbank strives to reduce its credit risk to protect the taxpayer from losses. The Executive Board's decision involves four fundamental amendments to the terms and conditions governing collateral for loans at the Riksbank:
The requirement for the lowest credit rating for securities to be accepted as collateral to be raised from the current A- to AA-.
Own-name covered bonds to be no longer accepted as collateral.
A limit rule to be introduced under which covered bonds as a share of a counterparty's total collateral may amount to a maximum of 60 per cent.
A limit rule to be introduced under which a maximum of 50 per cent of the share of a counterparty's collateral value that is composed of covered bonds may consist of covered bonds from the same issuer.
It is the Riksbank's assessment that the amendments will not affect the efficiency of the payment system to any great extent. Neither will they affect the conditions for pursuing monetary policy.
The amended terms and conditions will come into force in stages in 2016, starting on 11 January 2016.