Question ID:
2014_908
Legal Act:
Regulation (EU) No 575/2013 (CRR)
Topic:
Own funds
Article:
49
Paragraph:
2
Subparagraph:
-
COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations:
Not applicable
Article/Paragraph:
-
Disclose name of institution / entity:
No
Type of submitter:
Credit institution
Subject Matter:
Deductions of holdings of own funds instruments issued by financial sector entities included in the scope of consolidated supervision under art 49.2 CRR
Question:

For what specific purposes competent authorities may determine deductions of holdings of own funds instruments issued by financial sector entities included in the scope of consolidated supervision, apart from purposes mentioned in art 49.2: i.e. structural separation of banking activities and resolution planning? Should competent authorities determine deductions for all institutions in the member state or should it be more institution specific decision? In case of institution specific decision, should it be subject to joint decision, taken by the competent authorities of the home and host Member States?

Background on the question:

art 49.2 od CRR says: "2. For the purposes of calculating own funds on an individual basis and a sub-consolidated basis, institutions subject to supervision on a consolidated basis in accordance with Chapter 2 of Title II of Part One shall not deduct holdings of own funds instruments issued by financial sector entities included in the scope of consolidated supervision, unless the competent authorities determine those deductions to be required for specific purposes, in particular structural separation of banking activities and resolution planning." Competent authorities in one of the EU member states signalyse in different CRR-related quantitative exercises that they shall require banks to deduct holdings of own funds instruments issued by financial sector entities included in the scope of consolidated supervision, despite art 49.2, so far giving no reasoning for it.

Date of submission:
06/03/2014
Published as Rejected Q&A
11/02/2022
Rationale for rejection:

Please note that as part of adjustments to the Single Rulebook Q&A process, agreed by the EBA and the European Commission, it has been decided to reject outstanding questions submitted before 1 January 2020, when the Q&A process was updated as part of the last ESAs Review. In particular, the question that you have submitted has now regrettably been rejected and will not be addressed.

If you believe your question would still benefit from clarification, you are invited to resubmit your question, adapting it to reflect any legislative, regulatory or other relevant developments that may have occurred since the initial date of submission. The EBA will aim to address resubmitted questions as a matter of priority. When considering to resubmit, you are kindly requested to observe the updated admissibility criteria agreed in the context of the adjustment of the Q&A process, available in the Additional background and guidance for asking questions. We hope for your understanding.

For further information please refer to the press release and the updated Q&A page.

Status:
Rejected question
Image CAPTCHA