Collateral: Inclusion of the Italian Covered Bond Legislation in the exceptions list of “Own Issues” and “Close Links” rule for margin and principal collateral

1.  Introduction
 
Eurex Clearing herewith announces the inclusion of the Italian Covered Bond legislation to the exception in its “Own Issues” and “Close Links” rule. This rule, which governs eligibility of collateral, was first published with Eurex Clearing Circular 126/14, together with a definition of exceptions. The latest update to the rule was announced with Eurex Clearing Circular 032/22.

Consequently, own issue or close link securities in accordance with Italian Covered Bond legislation will be eligible as margin and principal collateral with Eurex Clearing AG.

Effective date: 30 June 2025

2.  Required action
 
We kindly ask you to forward this circular to all involved departments within your company. 

3.  Details of the initiative 

Eurex Clearing includes the Italian Covered Bond legislation as of 30 March 2023 in its “Own Issues” and “Close Links” rule for margin and Default Fund collateral, Special and GC Repo collateral, as well as GC Pooling collateral. With this measure, Eurex Clearing extends the list of defined exceptions to the rule under number 3 initially announced in Eurex Clearing Circular 126/14 (“Clarification of the Own Issues and Close Links Rule for margin collateral and principal collateral”) and updated with Eurex Clearing Circular 032/22 (“Collateral: Inclusion of the Belgian Covered Bond Law in the exceptions list of “Own Issues” and “Close Links” rule for margin collateral and principal collateral”).

Effective with 30 June 2025, the full list of exceptions to Eurex Clearing’s “Own Issues” and “Close Links” rule is as follows:

1.  Financial instruments of selected public issuers according to the definition in the Clearing Conditions of Eurex Clearing AG¹

2.  Issues of central governments with a defined minimum credit quality² that Eurex Clearing currently recognizes as guarantors; presently the following countries/governments qualify as guarantors³: Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Luxembourg, Netherlands, Norway, Sweden, Switzerland, United Kingdom, United States

3.  Covered bonds of issuers with high credit quality⁴ based on Eurex Clearing’s internal assessment, to which the following dedicated laws⁵ apply (i.e. covered bonds where the assets backing these bonds are appropriately segregated)⁶:

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¹  Clearing Conditions of Eurex Clearing AG, Chapter I Part 1 No. 2.1.3

²  In this context, “minimum credit quality” approximates external ratings in a range from AAA to AA. However, Eurex Clearing’s internal rating is the basis for a potential exception.

³  The list of countries might be revisited in the future.

⁴  High internal credit quality approximates external ratings in a range from AAA to A3/A-. However, Eurex Clearing’s internal rating is the basis for a potential exception.

⁵  The list of laws might be revisited in the future.

⁶  Commission Delegated Regulation (EU) No 153/2013 (ESMA) Ch. X, Art. 39 and Annex I, Section I (g) (i).

Unless the context requires otherwise, terms used and not otherwise defined in this circular shall have the meaning ascribed to them in the Clearing Conditions or FCM Clearing Conditions of Eurex Clearing AG, as applicable.
 

Further information