What Changed
- EBA published draft amendments to RTS on prudential requirements for CSDs and designated credit institutions offering banking-type ancillary services.
- CSDR Refit changes allow banking CSDs to provide cash and foreign exchange payment services to other CSDs to boost settlement efficiency.
- Draft RTS specify frameworks under CSDR Article 59(5) for monitoring, managing, reporting, and disclosing credit and liquidity risks, including intra-day risks.
Central securities depositories (CSDs) and designated credit institutions offering banking-type ancillary services in the European Union face updated regulatory expectations under draft Regulatory Technical Standards (RTS) published by the European Banking Authority (EBA). The EBA released a report proposing draft amendments to RTS specifying prudential requirements for CSDs, responding directly to structural updates introduced under the Central Securities Depositories Regulation (CSDR) Refit.
The CSDR Refit permits banking CSDs to provide banking-type ancillary services—including payment services involving cash and foreign exchange transactions—to other CSDs. The primary policy objective is to improve access to foreign currency for non-banking CSDs and enhance overall settlement efficiency in Europe. To ensure that heightened interconnectedness among financial infrastructure entities does not elevate systemic risk, the EBA's draft RTS set pragmatic rules focused on the risk profile of banking CSDs and the notification requirements for supervisory authorities. The draft standards also align references with the updated CSDR text and incorporate recent updates to the Capital Requirements Regulation (CRR).
Developed under the statutory mandate of Article 59(5) of the CSDR, the draft technical standards specify the necessary frameworks and tools for monitoring, measuring, managing, reporting, and publicly disclosing credit and liquidity risks, including intra-day risks. Under the regulatory framework, CSDs must hold proper authorization to render banking-type ancillary services. These authorized activities include offering cash accounts to participants in securities settlement systems, accepting deposits from such participants, and processing payment transactions involving cash and foreign exchange.
The source press release does not state publication, entry-into-force, or application dates. Relevant stakeholders and market participants may consult the official report directly via the European Banking Authority.
Who May Be Affected
Central securities depositories (CSDs), non-banking CSDs, designated credit institutions offering banking-type ancillary services, and supervisory authorities in the EU.
Cross-Border Context
Applies at the EU level to financial market infrastructures, facilitating foreign exchange access and cross-border settlement efficiency within European securities settlement systems.
What to check next
- Review the full Final Report PDF published by the EBA.
- Monitor formal legislative adoption and implementation updates by EU regulatory bodies.
This article provides general information and does not constitute legal advice. Consult the official text and obtain advice appropriate to your circumstances where needed.