Single Rulebook Q&A

Question ID: 2017_3129
Legal act : Regulation (EU) No 575/2013 (CRR) as amended
Topic : Liquidity risk
Article: 422, 460
Article/Paragraph : 27
COM Delegated or Implementing Acts/RTS/ITS/GLs: Delegated Regulation (EU) 2015/61 - DR with regard to liquidity coverage requirement
Type of submitter: Credit institution
Subject matter : Outflows associated with Payment Institutions' escrow accounts

Can the escrow accounts held for Payment Institutions be considered as operational deposits ?

Background on the question:

Payment Institutions are legally required to transfer the funds they receive to dedicated escrow accounts. These accounts are generally held in the books of Credit Institutions and mirror the deposits collected by the Payment Institutions. Payment Institutions cannot withdraw these funds freely.

Date of submission: 26/01/2017
Published as Final Q&A: 12/05/2017
EBA answer:

Deposits that are maintained by payment institutions in accordance with their legal obligation to safeguard funds received from their clients (e.g. escrow accounts) may be considered as operational deposits raised in the context of an established operational relationship according to Article 27(1)(a) of the Commission Delegated Regulation (EU) 2015/61 (LCR DA) to the extent that the conditions set out in Article 27(4) LCR DA are met.

Status: Final Q&A
Permanent link: link