From November 6, 2024, the Bank of Russia will implement changes in how it manages collateral for its operations. Credit claims included in collateral pools will be accepted only for intraday, overnight, and supplementary mechanism loans.
Credit claims that were part of collateral pools before this date will still be accepted as collateral for primary mechanism loans. However, credit institutions are prohibited from increasing the amount of such claims.
This decision aims to prevent credit institutions from using monetary policy operations to meet liquidity coverage ratio requirements.
According to the Bank of Russia, "The existing collateral under the primary mechanism of liquidity provision is sufficient for the Bank of Russia to provide funds to credit institutions to make payments and maintain required reserves, which meets the objectives of the said mechanism." The bank assures that the reduction in credit claims accepted as collateral for primary mechanism loans will be gradual and not affect the money market. If there are any changes in liquidity conditions, "the Bank of Russia can promptly move credit claims from the supplementary mechanism of liquidity provision to the primary one."