Unveiling key changes in ECB’s MMSR – a closer look

The European Central Bank (ECB) recently released revised guidelines for Money Markets Statistical Reporting (MMSR), bringing some key changes to the reporting framework. This comes hot on the heels of an earlier announcement by the ECB that it was expanding the scope of the regime, including 24 new firms that now required to report from next year.

What do the revised guidelines say?

• To improve efficiency and reduce reporting burden, transactions below EUR 500,000 nominal amount will not be reported across all money market segments and sectors, to maintain focus on significant transactions.                             

• Only ‘reverse stock loans’ or ‘reverse securities loans’ economically equivalent to a repurchase agreement, are reportable, focusing on cash-driven transactions with securities loaned. Other SLEBs are out of scope.

• To simplify and streamline Novations Reporting, ‘RELATED PROPRIETARY TRANSACTION IDENTIFICATION’ and ‘NOVATION STATUS’ fields will only need to be reported in the first rollover after novation, unless another novation occurs.

• Reporting of UTI in all four segments is strongly advocated however still not enforced; for FX Swaps, the far leg’s UTI needs to be reported if they differ for accurate identification of these transactions.

• ‘REFERENCE RATE INDICES ISIN CODES’ list truncated; EONIA and LIBOR indices ISINs have been removed. These revisions align with the wider adoption of the €STR benchmark interest rate and the ongoing decommissioning of EURIBOR and LIBOR indices.

Impact on reporting firms

Existing reporting firms must adjust their reporting logic to align with the revised guidelines, while the 24 new firms in scope will need to comply with MMSR regulations from July 1 2024, or can adopt early with prior notification to ECB. Adherence to these guidelines is vital for correct and accurate data submission, enabling the daily calculation of the €STR benchmark rate.

Focus on controls and data quality

The ECB emphasises the importance of controls and data quality. These guidelines aim to enhance the understanding of money markets, facilitate timely surveillance, improve information on monetary policy transmission, and provide reliable and transparent data to market participants. They guide reporting agents towards accurate reporting and increased market transparency. 

The revised guidelines represent a significant step in the quest for data accuracy and transparency in money markets. Together with the expanded number of reporting firms, streamlined requirements, and a strong focus on controls and data quality, the ECB aims to bolster market surveillance and strengthen monetary policy transmission. Reporting firms, both existing and new, play a crucial role in this journey towards data excellence, ensuring the integrity of the money markets and providing valuable insights for market participants and policymakers alike.

• Read the revised guidelines on the ECB’s website
• For a discussion with Faizal or one of our regulatory experts about your MMSR reporting requirements, please contact us.