Key data
| Regulation | Guideline (EU) 2026/690 of the ECB (ECB/2026/2) |
|---|---|
| Amended regulation | Guideline (EU) 2016/65 (ECB/2015/35) |
| Publication | 23 March 2026 |
| Entry into force | 22 January 2026 |
| Affected parties | Credit institutions and banks operating with the Eurosystem and the ECB |
| Category | European Regulation — Monetary Policy |
| Subject matter | Haircuts or valuation markdowns on collateral assets in monetary operations |
Banks operating with the Eurosystem must recalculate their available liquidity. Guideline (EU) 2026/690 of the ECB, in force since 22 January 2026, updates the haircuts or valuation markdowns applied to collateral assets used in monetary policy operations. Each percentage point change in these markdowns translates directly into greater or lesser financing capacity for each institution.
The regulation amends Guideline (EU) 2016/65 (ECB/2015/35), the technical reference framework that has been in force since 2015. This is not a cosmetic change: haircuts are the mechanism that determines how much money a bank can obtain for each euro of assets it deposits as collateral with the ECB.
What does this regulation establish?
When a bank needs liquidity from the ECB, it does not receive 100% of the nominal value of the assets it provides as collateral. The ECB applies a valuation markdown (haircut): if the haircut is 10%, a bond with a nominal value of 100 million euros only generates 90 million euros of available financing.
Guideline 2026/690 updates the percentages of these markdowns for the different types of eligible assets. The specific updated parameters are set out in the official text published in the Official Journal of the EU.
| Concept | Previous framework | Updated framework |
|---|---|---|
| Reference regulation | Guideline (EU) 2016/65 (ECB/2015/35) | Guideline (EU) 2026/690 (ECB/2026/2) |
| Subject | Haircuts on collateral assets in Eurosystem monetary operations | Update of the same haircut parameters |
| Validity | Since 2016 | Since 22 January 2026 |
The impact depends on the direction of change for each asset category: if haircuts increase, the same collateral portfolio generates less liquidity; if they decrease, it generates more. Institutions with portfolios concentrated in assets where markdowns are tightened are the most exposed.
Economic and operational impact
The immediate effect occurs in the liquidity balance of each credit institution. The capacity to obtain financing from the ECB depends not only on the volume of eligible assets available, but on the net value after applying haircuts. A change in these parameters can significantly alter the liquidity position without the bank having modified its portfolio.
The specific operational consequences are:
- Reduction in available liquidity if haircuts increase for the predominant assets in the institution's collateral portfolio.
- Need to substitute assets with others carrying more favourable haircuts under the new framework, which entails transaction costs and potential impacts on portfolio profitability.
- Review of internal liquidity management models to reflect the new parameters in financing capacity calculations.
- Indirect impact on credit to businesses and individuals: if bank liquidity is reduced, credit conditions in the market may tighten.
Who is affected?
- Credit institutions participating in Eurosystem monetary policy operations (main refinancing operations, longer-term refinancing operations, marginal lending facilities).
- Spanish banks operating with the Banco de España as the national central bank of the Eurosystem.
- Treasurers and asset and liability management (ALM) officers at financial institutions, who must recalculate available liquidity.
- Risk and compliance departments at banks, which must update their models with the new parameters.
- Businesses and individuals, indirectly, if the tightening of haircuts reduces the lending capacity of the banks they work with.
Practical example
A mid-sized bank holds a portfolio of eligible assets with a nominal value of 500 million euros to use as collateral in operations with the ECB.
Under the previous framework, with an average haircut of 8% on that portfolio, the available liquidity was 460 million euros (500M × 0.92).
If Guideline 2026/690 raises that average haircut to 10% for the predominant assets in that portfolio, the available liquidity falls to 450 million euros (500M × 0.90): 10 million euros less in financing capacity without having changed a single asset.
To recover the previous position, the bank would need to provide additional assets, substitute assets with others carrying lower haircuts, or accept a reduced short-term financing capacity. This calculation must be performed using the specific parameters published in the guideline for each asset category.
What should institutions do now?
- Review the portfolio of eligible assets provided or available as collateral with the ECB, identifying which asset categories are affected by the haircut changes under Guideline 2026/690.
- Recalculate available liquidity under the new framework by applying the updated parameters to each asset category, in order to determine the net impact on financing capacity.
- Update internal ALM and liquidity management models with the new haircuts, ensuring that regulatory liquidity ratios (LCR, NSFR) reflect the actual situation.
- Assess the need to substitute assets in the collateral portfolio if haircuts on predominant assets have been tightened, prioritising assets with more favourable markdowns under the new framework.
- Report the impact to the risk committee or finance management with a quantified analysis of the change in available liquidity, particularly if the impact exceeds relevant thresholds for treasury planning.
Frequently asked questions
What are ECB haircuts and why are they changing in 2026?
Haircuts or valuation markdowns are the discount percentages that the ECB applies to the nominal value of assets that banks provide as collateral to obtain financing. Guideline (EU) 2026/690 of the ECB, of 22 January 2026, amends Guideline (EU) 2016/65 to update these parameters, which may make access to liquidity more or less costly depending on the type of asset provided.
When does ECB Guideline 2026/690 on haircuts enter into force?
Guideline (EU) 2026/690 entered into force on 22 January 2026, although its official publication in the Official Journal of the EU took place on 23 March 2026. Credit institutions must apply the new parameters from the date of entry into force.
What must banks do to adapt to the new valuation markdowns?
Credit institutions must review their portfolios of eligible assets provided as collateral to the ECB and recalculate available liquidity under the new haircut framework. If markdowns increase for certain assets, financing capacity is reduced and it may be necessary to substitute assets or seek alternative sources of liquidity.
Does this regulation affect non-financial companies or only banks?
It directly affects only credit institutions and banks operating with the Eurosystem and the ECB. However, it has an indirect impact on businesses and individuals: if banks see their capacity to obtain liquidity from the ECB reduced, they may tighten the credit conditions they offer to their customers.
Which regulation does ECB Guideline 2026/690 replace or amend?
Guideline (EU) 2026/690 (ECB/2026/2) amends Guideline (EU) 2016/65 on valuation markdowns used in the implementation of the Eurosystem monetary policy framework (ECB/2015/35). It is a technical update of existing parameters, not an entirely new regulation.
Official source
View full regulation at official sourceDisclaimer: This article is for informational purposes only and does not constitute legal advice. For specific decisions, please consult a qualified professional. Source: https://eur-lex.europa.eu/./legal-content/AUTO/?uri=OJ:L_202600690