EBA欧洲银行-EBA-RTS-2013-11-28On-identified-staff29_61页_1mb

EBA Final Draft Regulatory Technical Standards Summary

Core Content

The EBA Final Draft Regulatory Technical Standards (RTS) aim to establish harmonised criteria for identifying categories of staff within credit institutions and investment firms whose professional activities have a material impact on the institution's risk profile, as required under Article 92(2) and Article 94(2) of Directive 2013/36/EU (CRD). These standards are intended to support competent authorities in ensuring compliance with remuneration requirements and to promote consistent application of these rules across the European Union.

Main Objectives

• To harmonise the identification of staff whose activities significantly affect the risk profile of an institution.
• To ensure that remuneration policies and variable remuneration are appropriately applied to these staff members.
• To promote effective risk management by aligning remuneration practices with the risk exposure of the institution.
• To address inconsistencies in national implementations of remuneration guidelines, such as the CEBS Guidelines.

Key Points and Criteria

Qualitative Criteria

• Staff members in management functions (e.g., members of the management body).
• Staff members in supervisory functions (e.g., members of the management body overseeing decision-making).
• Staff with key functions or managerial responsibilities over other identified staff.
• Staff with authority to commit to credit risk exposures or market risk transactions above certain thresholds (based on CET1 capital).

Quantitative Criteria

• Absolute threshold: Staff earning more than EUR 500,000 in the preceding financial year.
• Relative threshold: Staff in the top 0.3% of earners within the institution.
• High earners: Staff earning EUR 1,000,000 or more, which may only be excluded in exceptional circumstances.

Exclusions and Approval

• Institutions may exclude staff identified only under quantitative criteria if they can demonstrate that their activities do not have a material impact on the risk profile.
• Exclusions must be approved by competent authorities.
• For staff earning EUR 1,000,000 or more, notification to the EBA is required before approval.
• Exclusions should only be applied in well-justified exceptional cases.

Implementation and Supervision

• The identification process must be documented by institutions to enable supervisory review.
• Supervisory review is required under Article 92(2) of the CRD.
• The criteria should be applied consolidated at the group, parent company, and subsidiary levels, including those in offshore financial centres.
• Institutions are encouraged to use internal risk assessments alongside the common criteria to ensure a comprehensive and proportionate identification of staff.

Rationale and Background

• The CRD was introduced to address inappropriate remuneration incentives that contributed to short-term risk-taking and unstable strategies.
• The CEBS Guidelines provided general criteria for identifying staff with material impact, but national implementations were inconsistent.
• The EBA conducted a survey in 2012 to assess the application of these guidelines, highlighting the need for more harmonised and consistent identification criteria.
• The draft RTS are based on feedback from the public consultation and the Banking Stakeholders Group (BSG).

Key Information

• Scope: Applies to credit institutions and investment firms at all levels (group, parent, subsidiary) including those in offshore financial centres.
• Identification: A staff member is considered Identified Staff if they meet at least one of the qualitative or quantitative criteria.
• Remuneration: Identified Staff must be subject to specific remuneration policies and variable remuneration rules under the CRD.
• Exclusions: Permitted only under additional conditions and supervisory approval.
• Documentation: Institutions must record the identification process and staff assessments for supervisory review and auditing.

Conclusion

The EBA Final Draft RTS provide clear and consistent criteria for identifying staff whose professional activities significantly affect the risk profile of an institution. By combining qualitative and quantitative standards, the document ensures a balanced and proportionate approach to risk management and remuneration. The standards also allow for flexibility in identifying staff based on internal risk assessments, while maintaining supervisory oversight to ensure compliance and consistency across the EU.