On 18 June 2021, the European Central Bank (ECB) announced that the euro area banks it directly supervises may continue to exclude certain central bank exposures from the leverage ratio, as exceptional macroeconomic circumstances due to the COVID-19 pandemic continue. The announcement extends until March 2022 the leverage ratio relief granted in September 2020, which was set to expire on 27 June 2021.

The ECB’s announcement comes after its Governing Council confirmed that there are exceptional circumstances due to the COVID-19 pandemic.

The 3% leverage ratio requirement becomes binding on 28 June 2021. Euro area banks which decide to exclude central bank exposures must recalibrate this 3% leverage ratio requirement in such a way that only the central bank exposures newly accumulated since the beginning of the pandemic effectively benefit from the leverage ratio relief. In other words, only the increase in banks’ central bank exposures since end-2019 would in practice lead to leverage ratio relief: this maintains the level of resilience provided by the leverage ratio before the pandemic. More details are available in FAQs.