ECB Updates Eurosystem Collateral Framework with Second-Best Rating Rule

The European Central Bank (ECB) has made several changes to its Eurosystem collateral framework as part of a regular review. The new guidelines, published on September 29, 2026, introduce a second-best external rating rule for private sector assets and an updated haircut schedule.

Under the revised rules, the second-best rating issued by external credit assessment institutions will be used to assess the eligibility of private sector assets as collateral under the Eurosystem framework. This change applies to unsecured bank bonds, covered bank bonds, and assets issued by non-financial corporations in the euro area public sector.

The ECB has also updated its haircut schedule to better reflect risk estimates across maturities and credit quality steps. Haircuts for own-used covered bonds have been refined, and haircuts applied to individual credit claims will now take into account the type of amortisation, residual maturity, credit quality step, and interest-rate type.

Additionally, credit claims backed by COVID-19-related public sector guarantees will remain eligible only until the end of 2026. Financial subsidiaries of non-financial corporate issuer groups will be allocated to the same haircut category as their parent undertaking, subject to certain conditions.