# Haircut

- Canonical URL: https://www.gerhardmerk.de/haircut-2
- Post ID: 589096
- Modified: 2023-07-25T21:01:28+00:00
- Language: en

## Definition

In the banking business, in the case of loans, the inclusion of possible losses in the value of the assets tendered as collateral, such as: Securities or life insurance policies. - In the case of the central bank, the haircut specified by it (the percentage that is subtracted from the market value of the assets that are being used as collateral; the size of the haircut mirrors the calculated risk associated with holding the assets). - Under quantitative easing, the ECB lowered the threshold of securities accepted as collateral against liquidity; however, the haircut was increased in some cases. In contrast, the ECB tightened the requirements for asset-backed securities. - See liquidity swap, collateral, collateral. - See ECB Monthly Bulletin, February 2012, pp. 33 ff. (expansion of the list of eligible collateral pushed through the Governing Council); ECB Monthly Bulletin, July 2013, pp. 89 ff. (ECB haircuts since 2008; various overviews). Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent! University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec. Professor Dr. Eckehard Krah, Dipl.rer.pol. E-mail address: info@ekrah.com https://de.wikipedia.org/wiki/Gerhard_Ernst_Merk https://www.jung-stilling-gesellschaft.de/merk/ https://www.gerhardmerk.de/

## Machine-readable

- Generator: Merk Knowledge 1.1.1