FIN.

EP votes through Covid-19 lending changes

The European Parliament has approved changes to the CRR to encourage banks to lend to customers affected by Covid-19. Among other things, the changes:

  • extend the transitional arrangements for IFRS 9 by 2 years and provide capital add back;
  • align minimum coverage requirements for non-performing loans guaranteed by the public sector with those guaranteed by official export credit agencies;
  • defer application of the leverage ratio buffer to January 2023;
  • give a more favourable prudential treatment to loans to pensioners or permanent employees that are backed by pension or salary;
  • give better treatment to certain exposures to SMEs or infrastructure; and
  • no longer require banks to deduct certain software assets from their capital.

The EP’s plenary vote on the measures is due on 19 June.

Emma Radmore