Question ID
2013_527
Legal act
Regulation (EU) No 575/2013 (CRR)
Topic
Own funds
Article
46, 48, 470
COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations
Not applicable
Article/Paragraph
N/A
Type of submitter
Credit institution
Subject matter
Grandfathered Instruments and Deduction Threshold Exemptions
Question

When calculating the amount of Common Equity Tier 1 (CET 1) that is multiplied by 10%/17.65% for the purposes of threshold exemptions for deductions, should grandfathered instruments be included in the amount of CET1 to the extent that they qualify as CET 1 during the grandfathering period?

Background on the question

For example, if an institution had €10bn CET 1 (post deductions) excluding grandfathered instruments and had an additional €2bn grandfathered CET 1 that was eligible as a State aid instrument under Article 483 (or other instrument under Article 484), should the 10% threshold come to €1bn or €1.2bn until 31 December 2017?

Submission date
Final publishing date
Final answer

Common Equity Tier 1 (CET1) instruments that are eligible for grandfathering under Articles 483 and 484 of Regulation (EU) No. 575/2013 may be included in CET1 items for the purposes of calculating thresholds for exemptions from deduction.

Status
Final Q&A
Answer prepared by
Answer prepared by the EBA.
Note to Q&A

Update 26.03.2021: This Q&A has been reviewed in the light of the changes introduced to Regulation (EU) No 575/2013 (CRR) and continues to be relevant.

Disclaimer

The Q&A refers to the provisions in force on the day of their publication. The EBA does not systematically review published Q&As following the amendment of legislative acts. Users of the Q&A tool should therefore check the date of publication of the Q&A and whether the provisions referred to in the answer remain the same.