Pfandbriefe - Austria

1 Who is the issuer? Universal credit institution with a special licence
2 Does the bondholder have recourse to the issuer (in case of special issuer: recourse to the sponsor bank)? Direct
3 Who owns the cover assets? The issuer directly

And "Others" based on EU-CBD Art 9 Joint Funding
4 Is the issuer the originator of the cover assets? Yes, partly (external origination possible)

1 What type of assets may be included in the cover pool?
 
  Primary assets Substitution assets
Public sector assets Mortgage assets Other 1* Other 2* Other 3*  
Exposures to public sector entities x
Residential mortgage loans x
Commercial mortgage loans x
Ship loans x
Derivatives x
Exposures guaranteed by public sector entities (CRR 129 (1) a) x
Assets pursuant to CRR Art 129 (1) x


Other 1 is "Ship assets". Primary Asset must be at least 85% of Coverage Requirements pursuant to §9 Austrian CB Law.
2 What is the geographical scope of assets?
 
  Primary assets Substitution assets
Public sector assets Mortgage assets Other 1* Other 2* Other 3*  
Domestic x x x x
EEA x x x x
UK x x x x
CH x x x x


Other 1 is "Ship assets"
3 Is there a maximum level for substitute assets in the statutory national framework?
4 Are there any reporting requirements for covered bond issuers to investors? Yes, by law and in line with art. 14 of EU Covered Bond Directive
5 What is the frequency of reporting to investors? Quarterly

1 What is the basis for property valuation Mortgage lending value
2 Is a regular update of the property value required? Yes, automated / indexed valuation sufficient
3 What are the LTV limits (single asset based)? Please specify in %/n.a. Residential
Commercial

Residential 80%; Commercial 60%. Limits are directly referenced from CRR Art 129 (1) d) and f).
4 Are loans in excess of LTV limits eligible for inclusion in the cover pool? Yes (soft limit)

IV.1 Derivative contracts in the cover pool

1 Are derivative contracts eligible for the inclusion in the cover pool? Yes, exclusively for hedging purposes (by law)
2 Are there requirements for derivative contracts (e.g. eligibility criteria for hedging counterparties)? Yes, specified in law

Derivative Counterparty has to consent explicitly to the entry into the cover pool
3 Will derivative contracts remain in case of insolvency of the issuer? Yes
4 If derivatives are permitted in the cover pool, what is their ranking? Pari passu to covered bond holders

IV.2 Exposure to market risk

1 What is the primary method for the mitigation of market risk? Other

Credit institution must have appropriate risk management system in place. System must ensure the identification, assessment, management and monitoring of all risks associated with covered bond business, such as in particular market risks, interest rate and currency risks, credit and liquidity risks.
2 Are there mitigating provisions for interest rate risk? Other

see IV.2.1
3 Are there mitigating provisions for foreign exchange risk? Other

see IV.2.1
4 Are there mitigating provisions for maturity mismatch risk? Other

see IV.2.1
5 What type of coverage test is applied? Other, please specify

Nominal cover mandatory by law, additional optional present value cover (pursuant to Art 15 (6))
6 Are there stress scenarios applied? No

see IV.2.1

IV.3 Liquidity risk

1 Is exposure to liquidity risk mitigated? Yes, by law
2 What liquidity risk mitigation requirements are in place (principal)? 180 days liquidity provisions
Maturity extension provisions
Matching requirements
3 What liquidity risk mitigation requirements are in place (interest)? 180 days liquidity provisions
Matching requirements
4 What is the consequence of not fixing a breach of liquidity risk mitigants? Administrative penalty
5 If 180 days liquidity provisions are in place, what types of liquid assets are eligible LCR Level 1
LCR Level 2a
LCR Level 2b
Short term exposures to credit institutions (Credit Quality Step (CQS) 1)
Short term exposures to credit institutions (CQS 2)
Short term deposits to credit institutions (CQS 1)
Short term deposits to credit institutions (CQS 2)
Short term deposits to credit institutions (CQS 3)

Any assets pursuant to Art 129 (1) c
6 If 180 days liquidity provisions are in place, the calculation of principal is based on: The (extended) legal final maturity date

The extended maturity date may only apply for the liquidity buffer, if the extension is triggered. Otherwise the contractual maturity applies

IV.4. Maturity extension

1 Is maturity extension allowed by national law? Yes, but optional and subject to conditions
2 Is it possible to issue… Hard bullet
Soft bullet
3 Which trigger plays a role for maturity extension according to law - independent or alone or in combination? Issuer bankruptcy/resolution
4 Does any competent authority need to give its okay (or non-opposition)? No

IV.5 Overcollateralisation

1 Is mandatory overcollateralisation required in the law ?

All types of cover pools - 2% - nominal (or optional 2% present value over collateralisation with adherence to nominal principle pursuant to CBD Art 15 (6))

V.1 Cover pool monitor (CPM)

1 Is there a cover pool monitor in addition to national competent authorities in the statutory law? Yes, by law and in line with Article 13 of EU Covered Bond Directive
2 Is the CPM separate from the issuing credit institution? No, internal CPM allowed in line with the provisions of Article 13(3)

CPM can be separate as well as internal (right to choose for the credit institution)
3 Is the appointment, dismissal, eligibility criteria and the role of the CPM regulated by the national statutory law? Yes

V.2 Banking supervision

1 Which are the national competent authorities designated to carry out covered bonds public supervision in the law?

FMA - Finanzmarktaufsicht (Financial Market Supervision) - Website

2 Is a special permission required for a covered bond programme according to national law? Yes, licence for institution
3 Is there a covered bond issuance limit in law or regulation? If yes, please specify Yes

Issuance is not allowed if primary assets are below 85% of coverage requirements pursuant to §9 Austrian CB Law
4 Does the national statutory law provide for the appointment of a dedicated cover pool administrator in case of insolvency/resolution (transfer included acc. to BRRD [Bank Recovery and Resolution Directive])? Yes

Special administrator pursuant to CBD Art 20
5 Which is the typical frequency in the national statutory law of reporting from the covered bond issuers to the designated competent authorities? Quarterly

Quaterly frequency is statutory minimum but can be extended by regulation of the competent authority

1 Does the national statutory law meet the requirements laid down in the EU Covered Bond Directive? Yes
2 Does the statutory law meet the requirements of Article 129 of CRR [Capital Requirement Regulation]? In this case, please specify the collateral types meeting the Art. 129 CRR. Yes

Limited to cover pools that qualify for "European Covered Bonds (Premium)"
3 Does the statutory law allow covered bonds out of the scope of Art 129 of CRR? In this case, please specify the collateral Yes

Cover assets pursuant to CBD Art 6 (1) b) may not be mixed up with cover assets pursuant to CBD Art 6 (1) a) in one cover pool
4 Are listed covered bonds eligible in repo transactions with the national central bank? Yes

Conditional to additional requirements that are not defined in CBD but in the respective ECB-Guidelines

Any further comments/information?