Eurosystem counterparties may use eligible assets on a cross-border basis, i.e. they may obtain funds from the national central bank of the Member State in which they are established by making use of assets located in another Member State. A mechanism has been developed, this is the correspondent central bank model, under which national central banks act as custodians (“correspondent") for each other (and for the ECB) in respect of assets accepted in their local depository or settlement system. For instance a Luxembourg counterparty may pledge German securities as collaterals through the intermediary of the Buba in order to guaranty a refinancing operation of BCL. This CCBM facility is provided in each country of the euro area for the eligible assets or both Tier 1 and Tier 2 list.
The use of CCBM within the euro area has remained rather disparate, the most active correspondent central banks have been for 2005 the following: Luxembourg (22%), Belgium (19%), Italy (15%), Spain (14%) and Germany (10%).
Links between securities settlement systems
In addition to the CCBM, eligible links between EU securities settlement systems (SSS) can be used for the cross border transfer of securities, these links have to be approved by the ECB. In that case, a Luxembourg counterparty can pledge to the BCL on its account at Clearstream Luxembourg eligible securities issued into Clearstream Banking AG Frankfurt (Germany), Euroclear (Belgium), Banque nationale de Belgique, Monte Titoli (Italy), Oekb (Austria), Euroclear (Netherlands), VP (Denmark).
You have access to these links between securities settlement systems at the following address on the ECB website.
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