Regulation (EC) No 1745/2003 of the European Central Bank of 12 September 2003 on the application of minimum reserves (ECB/2003/9)

The following categories of institutions shall be subject to reserve requirements:

1. credit institutions as defined in the first subparagraph of Article 1(1) of Directive 2000/12/EC of the European Parliament and of the Council of 20 March 2000 relating to the taking-up and pursuit of the business of credit institutions⁽²⁾, other than participating NCBs;

2. branches as defined in Article 1(3) of Directive 2000/12/EC, of credit institutions as defined in the first subparagraph of Article 1(1) of the same Directive, other than participating NCBs; these include branches of credit institutions which have neither their registered nor their head office in a participating Member State.

Branches of credit institutions established in participating Member States which are located outside participating Member States are not subject to reserve requirements.

Without being obliged to submit any request, an institution shall be exempted from reserve requirements from the start of the maintenance period in which its authorisation is withdrawn or renounced, or in which a decision to submit the institution to winding-up proceedings is taken by a judicial authority or any other competent authority of a participating Member State.

The ECB may exempt the following institutions from reserve requirements on a non-discriminatory basis:

1. institutions subject to reorganisation measures;

2. institutions subject to the freezing of funds and/or other measures imposed by the Community or a Member State under Article 60(2) of the Treaty restricting the use of their funds or a decision of the ECB’s Governing Council suspending or excluding their access to open market operations or the Eurosystem’s standing facilities;

3. institutions for which the purpose of the ECB’s minimum reserve system would not be met by imposing reserve requirements upon them. In reaching a decision on any such exemption, the ECB shall take into account one or more of the following criteria:

   1. the institution is authorised to pursue special-purpose functions only;

   2. the institution is prohibited from exercising active banking functions in competition with other credit institutions;

   3. the institution is under a legal obligation to have all its deposits earmarked for purposes relating to regional and/or international development assistance.

The ECB shall publish a list of institutions subject to reserve requirements. The ECB shall also publish a list of institutions exempt from its reserve requirements for reasons other than being subject to:

1. reorganisation measures;

2. the freezing of funds and/or other measures imposed by the Community or a Member State under Article 60(2) of the Treaty restricting the use of an institution’s funds or a decision issued by the ECB’s Governing Council suspending or excluding an institution’s access to open market operations or the Eurosystem’s standing facilities.

Institutions may rely on these lists when deciding whether their liabilities are owed to another institution that is itself subject to reserve requirements. These lists shall not be determinative of whether institutions are subject to reserve requirements in accordance with Article 2.

An institution's reserve base shall comprise the following liabilities, as defined in the ECB's reporting framework laid down in Regulation (EU) No 1071/2013 of the European Central Bank (ECB/2013/33)⁽³⁾, resulting from the acceptance of funds:

1. deposits; and

2. debt securities issued.

If an institution has liabilities in relation to a branch of the same entity, or in relation to the head office or registered office of the same entity, which are located outside participating Member States, it shall include such liabilities in the reserve base.

The following liabilities shall be excluded from the reserve base:

1. liabilities owed to any other institution not included on the list of institutions exempt from the ECB's minimum reserve requirements in accordance with Article 2(3); and

2. liabilities owed to the ECB or to a participating NCB.

For the liability category ‘deposits’ referred to in point (a) of paragraph 1, the exclusion, as referred to in paragraph 2, shall be effected in the following manner: the institution shall provide evidence to the relevant participating NCB of the amount of liabilities referred to in points (a) and (b) of paragraph 2, and the amount evidenced shall be deducted from the reserve base.

For the liability category ‘debt securities issued’ referred to in point (b) of paragraph 1, the exclusion, as referred to in paragraph 2, shall be effected by deducting an amount from the reserve base in the following manner:

1. the institution shall provide evidence to the relevant participating NCB of the amount of liabilities referred to in points (a) and (b) of paragraph 2, and the amount evidenced shall be deducted from the reserve base;

2. where the institution is unable to provide evidence to the relevant participating NCB of the amount of liabilities referred to in points (a) and (b) of paragraph 2, the institution shall apply the standard deduction published on the ECB's website to the outstanding amount of the debt securities which it has issued and which have an original maturity of up to and including two years.

The institution shall calculate the reserve base in respect of a particular maintenance period on the basis of the data relating to the month two months prior to the month within which the maintenance period starts. The institution shall report the reserve base to the relevant participating NCB as required within the ECB's reporting framework for money and banking statistics laid down in Regulation (EU) No 1071/2013 (ECB/2013/33).

For institutions which have been granted the derogation set out in Article 9(1) of Regulation (EU) No 1071/2013 of the European Central Bank (ECB/2013/33)⁽⁴⁾ (‘tail institutions’), the reserve base shall be calculated, for two consecutive maintenance periods beginning with the maintenance period starting in the third month after the end of a quarter, on the basis of end-of-quarter data reported in accordance with point 4 of Part 1 of Annex III to Regulation (EU) No 1071/2013 (ECB/2013/33). These institutions shall notify their minimum reserves in accordance with Article 5.

A reserve ratio of 0 % shall apply to the following liability categories (as defined within the ECB’s reporting framework for money and banking statistics in Regulation (EU) No 1071/2013 (ECB/2013/33)):

1. deposits with agreed maturity over two years;

2. deposits redeemable at notice over two years;

3. repos;

4. debt securities issued with an original maturity over two years.

A reserve ratio of 1 % shall apply to all other liabilities included in the reserve base.

The amount of minimum reserves to be held by each institution in respect of a particular maintenance period shall be calculated by applying the reserve ratios to each relevant item of the reserve base for that period, as defined in Article 4. The minimum reserves identified by the relevant participating NCB and by the institution in accordance with the procedures mentioned in this Article shall constitute the basis for (i) remuneration of holdings of required reserves, and (ii) assessment of an institution's compliance with the obligation to hold the required amount of minimum reserves.

An allowance of EUR 100 000, to be deducted from the amount of the minimum reserves, shall be granted to each institution, subject to the provisions contained in Articles 11 and 13.

Each participating NCB shall determine procedures for the notification of institutions' individual minimum reserves, in accordance with the following principles. Either the relevant participating NCB or the institution shall take the initiative to calculate that institution's minimum reserves for the relevant maintenance period, on the basis of the statistical information and of the reserve base reported in accordance with Article 6 of Regulation (EU) No 1071/2013 (ECB/2013/33). The calculating party shall notify the other party of the calculated minimum reserves at the latest three NCB business days before the start of the maintenance period. The relevant participating NCB may specify an earlier date as a time limit for the notification of minimum reserves. It may also specify additional time limits for the institution to notify any revisions to the reserve base, and any revisions to the notified minimum reserves. If an institution abuses the opportunity that is offered by its participating NCB to revise the reserve base and the minimum reserves, the NCB may suspend permission for that institution to submit revisions. The notified party shall acknowledge the calculated minimum reserves at the latest on the NCB business day preceding the start of the maintenance period. If the notified party has not replied to the notification by the end of the NCB business day preceding the start of the maintenance period, it shall be deemed to have acknowledged the amount of minimum reserves of the institution for the relevant maintenance period. Once acknowledged, the institution's minimum reserves for the relevant maintenance period cannot be revised.

The participating NCBs shall publish calendars indicating the forthcoming time limits for notification and acknowledgement of data relevant to minimum reserves for the implementation of the procedures mentioned in this Article.

Where an institution fails to report the relevant statistical information as specified in Article 5 of Regulation (EU) No 1071/2013 (ECB/2013/33), the relevant participating NCB shall inform the institution concerned of the amount of the institution's minimum reserves that is to be notified or acknowledged, in accordance with the procedures mentioned in this Article, for the relevant maintenance period(s), estimated on the basis of historical information reported by the institution and any other relevant information. Article 6 of Regulation (EC) No 2531/98 and the ECB's power to impose sanctions for infringement of the ECB's statistical reporting requirements shall remain unaffected.