Collateral Security

ECC accepts a wide variety of highly liquid bonds as collateral.

However, ECC only accepts securities that are both

• ECB eligible and
• admissible for Eurex.

Furthermore, bonds need to meet the following requirements to be admissible for ECC:

• The remaining time to maturity needs to be 15 calendar days or more
• They need to be non-callable fixed rate or zero rate bonds
• Non-callable Floating rate bonds or non-callable reverse floating rate bonds with constant structure (i.e. they do not switch between fixed and floating coupons)
• No optionalities and inflation-linked coupon structure
• Acceptable risk profile based on the internal risk assessment

ECC does not accept own issues (wrong-way risk) as well as close link securities as eligible collateral. 

ECC determines concentration limits for margin and default fund requirements.

ECC has a collateral policy which establishes concentration limits at the level of:

• individual issuers
• country of issuer
• currency (except EUR).

If a concentration limit is violated, ECC's Clearing Operations team will contact the clearing member who submitted collateral leading to the breach to initiate a replacement of collateral.

The collateral policy and procedures are reviewed at least annually and whenever a material change occurs that materially affects the risk exposure.