Regarding the application of Article 8 (1) of Regulation (EU) No 575/2013 (CRR), can it be considered to extend the option to accept a liquidity sub-group to cases where the parent company is a EU parent financial holding company owning a single credit institution or a single investment firm, if all the conditions laid out in article 8 (1) of Regulation (EU) No 575/2013 (CRR) are met?

There is no particular difficulty for a financial holding company to respect organisational and legal requirements to manage a liquidity sub-group as a credit institution does:

- it can continuously monitor and supervise the liquidity positions of all institutions of the sub-group and ensure that there is an adequate level of liquidity for these institutions;

- it may contract for freely transfer funds between them to enable them to meet their individual and collective obligations when due;

- it complies with the prudential rules on liquidity on a consolidated basis.

Indeed :

• In terms of organizational and contractual requirements to manage the liquidity risk in a liquidity sub-group, a financial holding company can put them in place and respect them in the same way as a credit institution;

• In terms of utility for the prudential supervision, the parent financial company may have as only significant activity the one of its subsidiary institution so that the reporting on liquidity prepared on a consolidated basis provides information similar to that provided by its subsidiary institution on an individual basis.

• In economic terms, it seems strange not to consider this type of organization, which choice is often only linked to asset management considerations.

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.