Monetary policy counterparties

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The Bank of Italy takes care of the relationship with banks operating in Italy so that they can participate in Eurosystem monetary policy operations. Banks are admitted as counterparties for such operations as long as they meet the general eligibility criteria in accordance with the Eurosystem rules and administrative and technical/operational requirements.

Banks must be financially sound, both on a stand-alone and consolidated basis, in order to participate in monetary policy operations. Within a common set of rules (counterparty framework), the Eurosystem can adopt discretionary measures, including ones of a prudential nature, designed to suspend, exclude or limit access to operations by counterparties in breach of the capital, liquidity and indebtedness requirements set out in Capital Requirement Regulation (CRR - Regulation (EU)  575/2013) (see Articles 55a and 158 of Guideline (EU) 2015/510 of the European Central Bank on the EurLex website) or in case of late or incomplete transmission of the relevant data to the competent Authority.

As of 28 June 2021, the Guideline (EU) of the ECB of 6 May 2021, amending Guideline (EU) 2015/510 of the ECB, will enter into force. The amended Guideline implements a decision taken by the Governing Council to include the leverage ratio among the binding Pillar 1 own-funds requirements as of 28 June 2021, in line with the entry into force of related regulatory requirements (CRR2 - Regulation (EU) 2019/876).

Therefore, automatic measures are applied in case of breaches of the leverage ratio requirement or in case of incomplete or late transmission of the relevant data to the competent Authority in line with the other Pillar 1 own-funds requirements, consisting of the common equity tier 1 capital ratio, the tier 1 capital ratio and the total capital ratio.