- Question ID
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2015_1926
- Legal act
- Directive 2014/59/EU (BRRD)
- Topic
- Resolution financing arrangements
- Article
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103
- Paragraph
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2
- COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations
- Delegated Regulation (EU) 2015/63 - DR on ex ante contributions to resolution financing arrangements
- Article/Paragraph
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20
- Type of submitter
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Competent authority
- Subject matter
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Annual Contribution of institutions - determination of the basis for annual contributions and the risk weight / use of CRDIV/CRR terminology
- Question
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What information / data shal be used when determining the annual contributions to resolution financing arrangements in situations, where information required by specific indicators as referred to in Annex I and II of DA is not included in the applicable supervisory reporting for the reference year, e.g. due to inapplicability of the CRDIV/CRR?
- Background on the question
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Contribution base as well as the risk adjustment of contributions to resolution financing arrangements is mostly based on CRD IV / CRR terminology / definitions which were basically not in effect for the first calculation years. Nevertheless, in many cases there were equivalent data reported to national supervisors, like Tier 1, Risk Weighted Assets, etc.
- Submission date
- Final publishing date
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- Final answer
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The objective of the Commission, who is the author of the Delegated Act under Article 103(7) of the BRRD and can therefore provide the authentic intentions which guided the adoption of the act and its provisions, has been to allow resolution authorities to calculate those contributions on the basis of a set of data to be provided by the banks and a risk adjusting multiplier specified respectively in Annex II and Article 9 of the Delegated Act. For this purpose, Article 14 (1) of the Delegated Act clarifies that the resolution authorities should calculate the contributions on the basis of data which precede the contribution period effectively by two years. For example, for the first contribution period of 2015, the resolution authority would rely on all available data of 2013. That data is specified in Annex II of the Delegated Act and, under Article 14 (2) of the Delegated Act, the data has to be provided to the resolution authority at individual entity level. The data to be reported by the banks would have to be included in the latest approved annual financial statements, as referred to in Article 14 (1) of the Delegated Act, in the supervisory reporting requirements, as laid down by Commission Implementing Regulation (EU) No 680/2014, or, where applicable, in any other supervisory reporting requirement applicable to the institution under national law, as referred to in Article 14 (3) of the Delegated Act. In particular, Article 14 (3) of Delegated Act clarifies that the supervisory data shall be provided to the resolution authority as reported by the banks in the latest relevant supervisory report submitted to the competent authority pertaining to the reference year of the annual financial statement. The objective of the Commission was to allow the resolution authority to rely on all the available data, as referred to in Annex II, of 2013 already for the 2015 contributions period.
As the supervisory reporting requirements laid down by Commission Implementing Regulation (EU) No 680/2014 have only started applying as of 2014, resolution authorities should use for 2013 other alternative equivalent data reported under other supervisory reporting requirements applicable to the bank under national law. In other words and more generally, where the information required by a specific indicator as referred to in Annex II is not included in the supervisory reporting requirements laid down by Commission Implementing Regulation (EU) No 680/2014, the resolution authorities would need to use for 2013 other equivalent data reported under supervisory reporting requirements applicable to the bank under national law. By no means it was the objective of the Commission to exclude from the 2015 calculations data corresponding to the ones referred to in Annex II and available in 2013 under any other alternative supervisory reporting requirements applicable to the banks under national law and corresponding to the definitions of the Delegated Act. In fact, when adopting Article 20 (1) of the Delegated Act (which states that if the information as referred to in Annex II is not included in the applicable supervisory reporting requirement referred to in Article 14 for the reference year, that risk indicator shall not apply until that supervisory reporting requirement becomes applicable), the Commission, as the author of the Delegated Act, wanted to refer exclusively to those situations where neither the supervisory reporting requirements as laid down by Commission Implementing Regulation (EU) No 680/2014 nor any other alternative supervisory reporting requirement applicable to the banks under national law are available. Where some risk indicators are not part of the supervisory framework as of 2013, National resolution authorities (NRAs) should be allowed to use alternative measures in order to calculate risk adjusted contributions.
Disclaimer:
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.
- Status
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Final Q&A
- Answer prepared by
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Answer prepared by the European Commission because it is a matter of interpretation of Union law.
- Note to Q&A
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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.
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.