ESMA Issues Guidance on CCP Resolution Write-Down and Conversion Tool | LeapRate | Online Trading Industry News, Broker Intelligence & Fintech Analysis

The European Securities and Markets Authority (ESMA) has published a resolution briefing for Central Counterparties (CCPs), providing practical guidance on how national authorities should operationalise the write-down and conversion of instruments tool (WDCI). The briefing was published on 13 May 2026.

The WDCI is one of several tools available to National Resolution Authorities (NRAs) under the EU’s CCP recovery and resolution framework. In plain terms, it allows authorities to write down or convert a CCP’s liabilities, including the claims of clearing members, into equity or other instruments as part of a structured crisis response. ESMA’s briefing sets out a methodology for NRAs to follow when incorporating the WDCI into CCP resolution plans. It covers how NRAs should define the data they collect from CCPs to calibrate available resources, how to assess the impact on clearing members and financial market infrastructures, and how to ensure the necessary processes are in place to implement the tool effectively, including arrangements for any post-WDCI reorganisation of the CCP. The briefing follows two earlier publications in the same series covering CCP critical functions and resolution cash calls.

The guidance is directed primarily at NRAs across the EU and EEA, rather than CCPs or their clearing members directly. However, clearing members, which include major banks, broker-dealers and futures commission merchants, are explicitly identified as key stakeholders whose interests NRAs must account for when calibrating a WDCI. Firms that clear through EU CCPs should note that this briefing advances the build-out of a more standardised and operationally consistent resolution framework across member states, reducing the risk of inconsistent application in a cross-border stress scenario.

The briefing is effective immediately as guidance to NRAs. It forms part of ESMA’s broader programme to construct a single resolution rulebook for CCPs, with a focus on practical operationalisation of existing legal tools. No consultation deadline applies; this is published guidance rather than a rule-making proposal. The full briefing is available on ESMA’s website.