Temporary banking valuation adjustments due to COVID-19

Summary

The European Parliament has agreed not to object to a temporary regulation that adjusts how banks calculate asset valuations. This measure aims to provide capital relief to help banks manage market volatility caused by COVID-19.
9 17.06.2020
Other
finance
economy
financial institutions and credit

Key points

In force from 28/05/2020 Out of force from 31/12/2020
  • The regulation introduces temporary changes to the banking framework to address the COVID-19 pandemic's impact.
  • The aggregation factor used to calculate additional valuation adjustments is increased from 50% to 66%.
  • This adjustment reduces the amount of capital deducted from a bank's core equity reserves.
  • The temporary measure is set to expire on 31 December 2020.
These raw data are provided by the Open Data Portal of the European Union (data.europa.eu) and are licensed under ODC-BY 1.0.