Single Resolution Board publishes MREL dashboard Q3.2022
27 February 2023
For resolution entities, the average MREL final target (including the CBR), to be respected by 1 January 2024, was equal to 26.4% of the Total Risk Exposure Amount (TREA), remaining broadly stable compared to Q2.2022.
Today, the Single Resolution Board (SRB) has published its minimum requirement for own funds and eligible liabilities (MREL) dashboard for Q3.2022.
Key findings:
For resolution entities, the average MREL final target (including the CBR), to be respected by 1 January 2024, was equal to 26.4% of the Total Risk Exposure Amount (TREA), remaining broadly stable compared to Q2.2022.
The MREL shortfall (including the CBR) with respect to the final targets continued to decline, albeit at a slower pace, reaching the value of EUR 30.5 bn (corresponding to 0.4% TREA).
For non-resolution entities, the MREL shortfall against the final targets (including the CBR) rose over the quarter, amounting to EUR 20.9 bn (corresponding to 0.9% TREA).
The maturity profile of the MREL instruments showed that around 39% of the stock was made of instruments with residual maturities between two and 10 years, while the share of short-term MREL debt (maturing between one and two years) remained low, equal to about 7% of the total.
Overall, SRB banks issued EUR 75 bn of MREL-eligible instruments, a higher level compared to the previous quarter as well as year-on-year.
In the final months of the year, market conditions improved significantly and investors’ demand in unsecured primary markets was strong. At the end of September, funding costs reached the highest levels since the beginning of 2022, but decreased throughout the last quarter of the year, reaching in December the lowest levels since mid-August. However, they were higher than pre-pandemic levels of the beginning of February 2020.
