The EU has adopted temporary rules amending CRR 2 to maximise the ability of banks to lend money during the Covid-19 crisis. The changes:
- change the minimum capital banks need to hold for NPLs – in particular by extending the preferential treatment for NPLs guarantees by export credit agencies to other public sector guarantors;
- extend transitional arrangements for the implementation of IFRS 9 by another 2 years;
- reintroduce, temporarily, a prudential filter for sovereign bond exposures;
- allow supervisors to take measures to mitigate the negative effects of the extreme market volatility;
- make targeted changes to the calculation of the leverage ratio and delay the introduction of the leverage ratio buffer to January 2023;
- put in place transitional arrangements for exposures to national governments and central banks denominated in the currency of another member state; and
- introduce, early, some capital relief measures, particularly for the preferential treatment of some loans backed by pensions or salaries, and SME and infrastructure loans.
The measures will become applicable no later than the end of June.