Monetary policy

What are the main changes that the ECMS will bring?

  1. Move to a counterparty pool structure:
    • The Banco de España will create and configure the pools for its counterparties.
    • Each pool is divided into a collateral position and a credit position derived from monetary policy operations.
  2. Main changes in collateral management:
    1. Changes in marketable asset management:
      • Use of the ISO 20022 message exchange standard (A2A).
      • Instructions can be entered using the ECMS interface (U2A environment).
      • Allowed value date: instructions can be sent up to 20 days in advance (D-20).
    2. Changes in the handling of credit claims derived from non-mortgage loans or credits (CCs):
      • CCs can be registered before mobilisation or simultaneously in the instruction itself.
      • For the management of CCs in A2A, the current files are no longer sent to the Banco de España; instead, files in a standardised Eurosystem format are sent to the ECMS.
      • The cut-off time for entering instructions via the ECMS interface (U2A) is extended to 17:45.
      • The value date for mobilisation and updates can be up to 10 days in advance (D-10).
      • CCs are valued from the day of mobilisation.
      • The 12-position non-marketable identification codes are replaced by a 15-position ECMS credit claim identifier. These ECMS credit claim identifier are generated when the CC is registered
  3. Main changes in credit operations:
    • The settlement schedules for open market operations (OMOs) are aligned with those of the marginal lending facility (MLF), making netting easier.
    • Marginal lending facility: requests are sent to the ECMS (either U2A or A2A) and D+1 requests are allowed when an OMO or MLF matures.
    • Option to set a maximum credit line (MaCL).
  4. Other changes:
    • Internal accounts are created in ECMS (for securities and credit claims derived from non-mortgage loans or credits) which serve as a register of the pledged assets.
    • Reference to these internal accounts is sufficient to instruct the (de)mobilisation of pledged assets (reference to the external account can be omitted from the instruction).
    • Pool projection functionality, providing a view (up to 20 days forward) of the expected evolution of a counterparty’s collateral and credit.
    • There is a wider range of lists and messages to subscribe to.

The community under the Banco de España’s remit (counterparties and Iberclear) must assess the impact of the project and, where applicable, adapt systems in readiness to use the ECMS. National central banks and their communities will conduct tests monitored by the central bank, thus tracking the progress of the project before it is deployed and ensuring that the entire community is ready to successfully migrate to the new system.