EBA publishes final technical standards on estimation of Pillar 2 and combined buffer requirements for setting MREL

23 December 2020

The European Banking Authority (EBA) published today its final draft Regulatory Technical Standards (RTS) specifying the methodology to be used by resolution authorities to estimate the Pillar 2 (P2R) and combined buffer requirements (CBR)  at resolution group level for the purpose of setting the minimum requirement for own funds and eligible liabilities requirement (MREL). These standards are part of the EBA's major programme of work to implement the BRRD and address the problem of too-big-to-fail banks.

The estimation of P2R and CBR is necessary for setting MREL when the resolution group perimeter differs significantly from the prudential perimeter at which own fund requirements have been set by the competent authority.

The final draft RTS further specify a straightforward and proportionate methodology for estimating own fund and combined buffer requirements. They provide a framework for a dialogue between resolution groups, competent authorities and resolution authorities aiming to improve the accuracy of the input for MREL setting.

Legal basis

These final draft RTS have been developed according to Article 45c4 of the Bank Recovery and Resolution Directive (BRRD).

 

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