Own funds

To be able to absorb losses in a going or in a gone concern situation, institutions need own funds in sufficient quantity and quality in accordance with applicable European legislation. The Capital Requirements Regulation (CRR) sets out the characteristics and conditions for own funds and specifies a series of mandates for the EBA. These include the development of Regulatory Technical Standards to further specify the quality criteria applying to institutions' regulatory own funds, as well the deductions that should be applied to own funds elements and the harmonizing disclosures. In addition, the EBA monitors the quality of own funds on an on-going basis and may provide advice and opinions.

Technical Standards, Guidelines & Recommendations

  • RTS on methods of prudential consolidation

    The aim of these draft RTS is to ensure that the appropriate method of prudential consolidation is applied for the calculation of the Capital Requirements Regulation (CRR) requirements on a consolidated basis.

    Status: Under development

  • Guidelines for the identification of global systemically important institutions (G-SIIs)

    These Guidelines foresee that G-SIIs, as well as other large institutions that have an overall exposure of more than EUR 200 billion Euro and are systemically relevant, will be subject to the same disclosure requirement.

    Status: Final and translated into the EU official languages

  • Regulatory Technical Standards (RTS) on Own Funds

    These Regulatory Technical Standards (RTS) gather a number of mandates given to the EBA by the Capital Requirements Regulation (CRR) in relation to own funds. These RTS include provisions regarding: technical aspects in relation to Common Equity Tier 1, Additional Tier 1, deductions from Common Equity Tier 1 and from own funds in general, as well as transitional provisions on grandfathering; the treatment of gains on sale associated with future margin income in a securitisation context; the conditions under which competent authorities may determine that a type of undertaking is recognised under applicable national law as a mutual, cooperative society, savings institution or similar institution; the criteria to define broad market indices, the calculation of minority interest and the deduction of indirect and synthetic holdings.

    Status: Adopted and published in the Official Journal

  • Technical standards for the identification of global systemically important institutions (G-SIIs)

    The Regulatory Technical Standards (RTS) provide consistent parameters and specify a harmonised methodology for identifying G-SIIs and determining adequate levels of own funds across the European Union. The draft Implementing Technical Standards (ITS) define uniform disclosure requirements to publicise the values used for the identification and scoring process for G-SIIs. The draft Guidelines foresee that G-SIIs, as well as other large institutions that have an overall exposure of more than EUR 200 billion Euro and are systemically relevant, will be subject to the same disclosure requirement.

    Status: Adopted and published in the Official Journal

  • Guidelines on criteria to to assess other systemically important institutions (O-SIIs)

    These Guidelines set forth common European criteria for the assessment of O-SIIs with the aim of striking the appropriate balance between a European framework ensuring a level playing field and comparability across the Union, on the one hand, and the need to take into consideration specificities of Member States' individual banking sectors, on the other.

    Status: Final and translated into the EU official languages

  • Regulatory Technical Standards (RTS) on own funds requirements for investment firms

    The purpose of these RTS is to harmonise the calculation of capital requirements for investment firms with limited authorisation to provide investment services, as well as to harmonise the conditions under which competent authorities can make adjustments to such requirements. To this end, the draft RTS also provide a definition of fixed overheads. These RTS will be part of the Single Rulebook aimed at enhancing regulatory harmonisation in the banking sector in Europe.

    Status: Adopted and published in the Official Journal

  • Implementing Technical Standards (ITS) on Disclosure for Own Funds

    These technical standards aim at ensuring a uniform approach to disclosure for own funds by institutions and across jurisdictions in order to allow detailed assessments of banks’ capital positions and to make cross-jurisdictional comparisons. The requirements contained in the draft ITS are directed at institutions which are requested to complete three sets of templates: a general own funds disclosure template reflecting the capital position of institutions; a transitional disclosure template covering the phasing in of the regulatory adjustments and a template describing the main features of an institution’s capital instruments.

    Status: Adopted and published in the Official Journal

  • Guidelines on instruments referred to in Article 57(a) of the CRD

    These guidelines are in response to Article 63a (6) of the revised CRD (CRD II) that require CEBS to elaborate guidelines for the convergence of supervisory practices with regard to the instruments referred to in point (a) of Article 57. On the basis of these provisions, a set of 10 criteria has been developed for the assessment of capital instruments that may be included in original own funds without limit.

    Status: Repealed

  • Guidelines for Hybrid Capital Instruments

    These Guidelines aims to promoting the convergence of supervisory practices with regard to hybrid instruments by setting out minimum requirements for the inclusion of those instruments in original own funds, hence enhancing the quality of own funds. The Guidelines are structured into five main parts covering permanence, flexibility of payments, loss absorbency, limits and Special Purpose Vehicles (SPVs).

    Status: Repealed

  • Guidelines on prudential filters for regulatory capital

    These guidelines put forward prudential filters for the case of institutions that apply IFRS for prudential purposes in order to avoid any unwanted impacts in regulatory own funds.

    Status: Repealed

Opinions, Reports and other Publications

 

Opinions

 

Other Publications

 
 

 

 

 

 

 

 

 

 

 
 

 

 

 

 

 
 

Reports

  • AT1 report Q2 2018 update [679.7KB]

    The European Banking Authority (EBA) published today its third updated Report on the monitoring of Additional Tier 1 (AT1) instruments. The EBA’s monitoring of capital instruments has been... Read more

    20/07/2018

  • CET1 report Q2 2018 update [609.7KB]

    The European Banking Authority (EBA) published today a new updated list of Common Equity Tier 1 (CET1) instruments of EU institutions. This list is accompanied by an updated CET1 Report, which... Read more

    20/07/2018

  • Report on OFIs [897.2KB]

    The European Banking Authority (EBA) published today an Opinion addressed to the European Parliament, Council and European Commission, on matters relating to the regulatory perimeter under the... Read more

    09/11/2017