Response to consultation on Guidelines on third country branches capital endowment requirement

Q1. Do you consider the described requirements that capital endowment instruments should meet appropriate to ensure that they are available for use in the case of resolution of the TCB and for the purposes of the winding-up of the TCB? Is there any further requirement the EBA should consider adding? Or alternatively removing?

While the Guidelines comprehensively describe the forms and eligibility criteria of financial instruments that could meet the capital endowment requirement, particularly for the category of “other instruments”, but its focus is mainly on the asset side. From the equity side of TCBs, the term “capital endowments” remains undefined.

Q2. Do you consider the list of instruments proposed for the purposes of Article 48e(2)(c) of Directive 2013/36/EU adequate? Is there any further instrument the EBA should consider adding? Or alternatively removing?

While the Guidelines comprehensively describe the forms and eligibility criteria of financial instruments that could meet the capital endowment requirement, particularly for the category of “other instruments”, but its focus is mainly on the asset side. From the equity side of TCBs, the term “capital endowments” remains undefined.

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