|1. Distinction between EU/EEA-countries and third states|
As concerns the eligibility criteria in the the field of cross-border public finance, there is a distinction between the EU/EEA-countries on the one hand and Switzerland, USA, Canada and Japan on the other.
Public-sector borrowers from other EU/EEA-countries
In EU/EEA countries, claims against sovereigns, their central banks and the sub-sovereign entities are eligible for the cover pool.
Public-sector borrowers from Switzerland, the USA, Canada and Japan
Where Switzerland, the USA, Canada, Japan and their central banks and sub-sovereign entities are concerned, the eligibility for the cover pool is linked in each case to the requirement that the public-sector borrower has been allocated to credit quality step 1.
In the case of sub-sovereigns, the respective state’s choice of method according to the Basel II-agreement, i.e. whether it has opted for the “central government risk weight based method” or the “credit assessment based method”, is important with regard to the determination of the credit quality step.
2. International organizations and multilateral development banks
In Annex VI No. 4 the Banking Directive contains a list of development banks being allocated to credit quality step 1.
The term “international organizations” refers to the European Community, the International Monetary Fund and the Bank for International Settlements (Annex VI No. 5 of the Banking Directive).
3. Foreign export credit agencies
4. The “10%-limit” (§ 20 par. 1 sent. 2 PBA)
It usually requires an extensive legal research of the respective national law in order to ascertain the existence of such a preferential claim in case of insolvency.
Stöcker, Otmar: § 86 a: Grundzüge des Pfandbriefrechts. In: Schimansky/Bunte/Lwowski: Bankrechts-Handbuch. München 2007