EBA欧洲银行-Report-on-the-Use-of-Allowances_10页_453kb

EBA Follow-Up Report Summary

1. Core Content

The European Banking Authority (EBA) conducted a follow-up investigation into the application of Directive 2013/36/EU (CRD) regarding remuneration policies for credit institutions and investment firms, particularly focusing on the use of role-based allowances (RBA) and compliance with the bonus cap. The EBA published its Opinion in October 2014, which clarified the distinction between fixed and variable remuneration components. Competent authorities (CA) were requested to ensure that institutions aligned their remuneration practices with the EBA's findings by December 31, 2014.

2. Main Findings and Supervisory Actions

2.1 Legal and Supervisory Measures

• No specific legal/regulatory measures were adopted by CA in response to the EBA Opinion, as the final guidelines on remuneration were expected by the end of 2015.
• One CA (ES) developed a binding circular incorporating the EBA Opinion's criteria, though its adoption was pending.
• Three CA (LU, DE, SK) stated that their legal frameworks were already aligned with the EBA Opinion before it was published.
• Supervisory measures were implemented by most CA, including:
  • Sending letters to institutions to ensure compliance with EBA criteria.
  • Conducting inspections or thematic reviews.
  • Requesting self-certifications.
  • Reallocating RBA as variable remuneration where necessary.

2.2 Use of Allowances and Compliance

• All CA identified institutions using allowances that required verification against the EBA Opinion's criteria.
• Institutional adjustments were made in several countries:
  • In BE and NL, institutions changed their remuneration practices to align with the EBA Opinion.
  • In IE, three out of eight institutions adjusted their RBA to meet the criteria.
  • In FR, two banking groups revised their plans to reflect the EBA findings.
  • In UK, CA ensured that institutions' remuneration policies for 2015 and onwards reflected the EBA criteria.
• Some CA observed that RBA with risk-taking incentives or discretionary nature should be classified as variable remuneration, not fixed.

2.3 New Fixed Remuneration Components

• In AT and FI, CA identified new forms of supposedly fixed remuneration:
  • Share appreciation rights (SAR): Awarded to management and selected employees, with performance conditions. The CA is still reviewing this practice.
  • Matching share programme: Employees receive shares proportional to their ownership, with a recommendation to hold them until their value equals annual fixed remuneration. This was classified as variable remuneration by CA.
• These new components were examined to ensure they met the EBA criteria for fixed remuneration, and in some cases, institutions were requested to revise their policies accordingly.

3. Conclusion and Next Steps

• All CA stated that remuneration requirements are subject to supervisory review, typically as part of the Supervisory Review and Evaluation Process (SREP).
• Some institutions had already changed their remuneration practices by 2014, while others would make changes for 2015 and onwards.
• The EBA is finalizing its guidelines on sound remuneration policies, which will provide further clarity on classifying remuneration components.
• The EBA is also working with the European Commission to review remuneration provisions, including assessing the need for legislative reinforcement.

4. Key Information

• Bonus Cap: A limit of 100% (or 200% with shareholder approval) on the ratio between variable and fixed remuneration.
• Role-Based Allowances (RBA): Treated as part of fixed remuneration by institutions, but some CA classified them as variable due to lack of predetermined, transparent, or irrevocable nature.
• EBA Opinion Criteria: Fixed remuneration must be predetermined, transparent, permanent, not incentivizing risk-taking, and non-revocable.
• Compliance Status: Most institutions have made adjustments to align with the EBA Opinion, but some remain under review.

5. Summary of Supervisory Actions

6. Next Steps

• The EBA will continue to finalize its remuneration guidelines.
• Further collaboration with the European Commission is expected.
• Ongoing supervisory reviews will ensure compliance with the bonus cap and EBA Opinion criteria.