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Breadcrumb

  1. Home
  2. Single Rulebook Q&A
  3. 2020_5364 Clarification on the determination of the relevant currencies
Question ID
2020_5364
Legal act
Regulation (EU) No 909/2014 (CSDR) - only RTS 2017/390
Topic
Market infrastructures
Article
59
Paragraph
4
Subparagraph
c
COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations
Regulation (EU) 2017/390 - RTS on prudential requirements of CSDs (CSDR-related)
Article/Paragraph
Article 36, paragraph 8
Name of institution / submitter
National Bank of Belgium
Country of incorporation / residence
Belgium
Type of submitter
Competent authority
Subject matter
Clarification on the determination of the relevant currencies
Question
1. How should CSD-banking service providers determine the negative net cumulative positions, which are needed to determine the relevant currencies as referred to in point (c) of Article 59(4) of Regulation 909/2014? 2. In addition, which values should be used to rank the currencies from highest to lowest? 3. Finally, how should the average for currencies without three negative net cumulative positions be calculated?
Background on the question
Article 36(8) of Regulation 2017/390 sets out how CSD-banking service providers should determine their relevant currencies as referred to in point (c) of Article 59(4) of Regulation 909/2014. The article uses the concept of negative net cumulative positions but does not specify what this means. This concept is introduced in the BCBS paper 248, to which recital 47 of Regulation 909/2014 also refers in the context of addressing intra-day liquidity risks. As a first step in the calculation of relevant currencies in accordance with Article 36(8)(a) of Regulation 2017/390, the currencies should be ranked from highest to lowest based on the average of the three largest negative net cumulative positions. It is unclear how the largest negative cumulative positions are to be selected: based on aggregated data (converted into euro) or data per currency. Finally, the CSD-banking service provider should average the values in order to rank the currencies. However, we note that there might be currencies for which the CSD-banking service provider did not have three negative net cumulative positions (i.e. only one or two). The article does not elaborate on such a situation.
Submission date
14/07/2020
Rejected publishing date
04/08/2022
Rationale for rejection

This question has been rejected because the issue it raises is beyond the remit of the Q&A process and as such it cannot be addressed via a Q&A. 

The Single Rule Book Q&A tool has been established to provide explanations and non-binding interpretations on questions relating to the practical application or implementation of the provisions of legislative acts referred to in Article 1(2) of the EBA’s founding Regulation, as well as associated delegated and implementing acts, and guidelines and recommendations, adopted under these legislative acts. The Q&A process cannot consider issues which would require changes to the regulatory framework. 

For further information on the purpose of this tool and on how to submit questions, please see “Additional background and guidance for asking questions”.

Status
Rejected question

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