Question ID:
Legal Act:
Directive 2014/59/EU (BRRD)
Early intervention
1, 2
COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations:
Not applicable
Disclose name of institution / entity:
Type of submitter:
Competent authority
Subject Matter:
Amendments to Article 19

Could you please clarify Article 19(1) and (2) of Directive 2014/59/EU (BRRD)? The words “that meets the conditions for early intervention pursuant to Article 27” in Article 19(1) were added to the original draft of the BRRD), in addition to the insertion of Article 19 (2), which provides that the Intra Group Financial Support (IGFS) chapter does not apply if ”none of the parties” meets the conditions of early intervention. The addition to the original draft refers to “arrangements” rather than “agreements”. We understand “arrangements” to be broader, and to refer to arrangements of any kind. Only a subset of these, called ”group financial support agreements” are regulated by the BRRD. Does this variation in terminology affect implementation?

Background on the question:

We understand that the changes to the original draft are to restrict the application of the IGFS rules to cases where an “institution” (bank or investment firm) in the group is failing, because only an institution can meet those conditions in Article 23. We would appreciate guidance on how to interpret these provisions. Importantly, where all the banks and investment firms in the group are sound, but a parent hold company assists a failing ‘financial institution’ (to whom the conditions in Article 23 do not apply), the IGFS rules do not apply?

Date of submission:
Published as Final Q&A:
Final Answer:

Article 19(1) of Directive 2014/59/EU (BRRD) and the exemption in Article 19(2) exclude all "arrangements" (a broad generic term which includes agreements) from the IGFS Chapter that do not confine financial support exclusively and specifically to early intervention scenarios, i.e. situations in which a party meets the conditions set out in Article 27(1). This also limits the scope of application of the IGFS Chapter to those intra-group financing agreements that are set up to support institutions. However, if such IGFS agreement envisages the provision of financial support not only to institutions that meet the conditions for early intervention but also to other group entities, it is still subject to authorisation (the exemption requires that "none of the parties" meets the conditions for early intervention). If, on the basis of such IGFS agreement, one party considers to grant financial support to another party that is not an institution, the competent authority may, however, not oppose such financial support under Article 25. Given the authorisation requirement under Article 20, a broader scope of application that would include business-as-usual financial support agreements (such as guarantees, letters of comfort) would not seem in line with the purpose of facilitating intra-group financial support. Potential risks for financial stability caused by business-as-usual intragroup financial support can be addressed through other instruments, e.g. the powers to remove impediments to resolvability (see e.g. Art. 17(5)(a)).


This question goes beyond matters of consistent and effective application of the regulatory framework. A Directorate General of the Commission (Directorate General Financial Stability, Financial Services and Capital Markets Union) has prepared the answer, albeit that only the Court of Justice of the European Union can provide definitive interpretations of EU legislation. This is an unofficial opinion of that Directorate General, which the European Banking Authority publishes on its behalf. The answers are not binding on the European Commission as an institution. You should be aware that the European Commission could adopt a position different from the one expressed in such Q&As, for instance in infringement proceedings or after a detailed examination of a specific case or on the basis of any new legal or factual elements that may have been brought to its attention.

Final Q&A
Answer prepared by:
Answer prepared by the European Commission because it is a matter of interpretation of Union law.
Note to Q&A:

Update 26.03.2021: This Q&A has been reviewed in the light of the changes introduced to Directive 2014/59/EU (BRRD) and continues to be relevant.