EBA欧洲银行-BSG-response-to-Consultation-Paper-28EBA-CP-2014-41292026-February-2015_11页_265kb

EBA Banking Stakeholder Group Consultation Summary on EBA/CP/2014/41

Core Content

The EBA Banking Stakeholder Group (BSG) has provided detailed comments on the draft Regulatory Technical Standards (RTS) under Directive 2014/59/EU, focusing on the Minimum Requirement for Own Funds and Eligible Liabilities (MREL). The BSG supports the harmonisation of supervisory rules across Europe to ensure fair competition and efficiency in cross-border banking groups. They also highlight the importance of data sharing and avoiding reporting duplication.

Main Views

• Objective of MREL: The BSG supports the objective of establishing a credible and effective resolution framework, aiming to avoid bail-outs by ensuring that banks have sufficient liabilities to absorb losses.
• Bail-in Tool: The bail-in tool is central to the new resolution philosophy, and MREL serves as its complement.
• Costs and Benefits: While MREL may entail certain costs, such as changes in liability structure and higher funding costs, it enhances bank fundamentals and increases market discipline.
• TLAC Integration: The BSG acknowledges the effort to integrate the Total Loss Absorption Capacity (TLAC) principles from the Financial Stability Board into the EU context (BRRD), but notes that the two frameworks have different rationales.

Key Issues and Recommendations

1. Flexibility and Proportionality

• The BSG supports a flexible and proportional approach to MREL, tailored to each institution's size and business model.
• They recommend a symmetric treatment for the resolution authority to adjust the loss absorption amount both upwards and downwards based on the institution's characteristics and resolution plan.

2. Recapitalisation Amount

• The BSG is concerned that the inclusion of Pillar 2 requirements and combined buffers in the recapitalisation amount may overestimate the required capital.
• They suggest excluding these from the recapitalisation amount calculation to avoid duplication and bias.

3. Peer Group Approach

• The BSG believes the use of a peer group to calibrate the recapitalisation amount is not appropriate and may be overly conservative.
• They recommend that the peer group should be redefined post-resolution to reflect the new situation of the institution.

4. Conflict Between Authorities

• The BSG is worried about potential conflicts between resolution authorities and supervisors due to the discretionary power given to resolution authorities in adjusting the loss absorption amount.
• They suggest that the EBA should encourage cooperation and not allow resolution authorities to question the capital requirements set by supervisors.

5. De Minimis Derogation

• The BSG agrees with the de minimis derogation for excluded liabilities accounting for less than 10% of a given insolvency class but suggests increasing the threshold to at least 20% or 30%.
• They also recommend including shorter-term debt in the assessment of loss absorption, with a haircut ratio based on the likelihood of its removal from the balance sheet.

6. Systemic Institutions and 8% Floor

• The BSG supports the 8% floor for systemic institutions, as it aligns with the BRRD spirit and serves as a backstop.
• They believe this level should also be a reference for other institutions, with proportionality considerations.

7. Transition Period

• The BSG agrees with the transition period but emphasizes the need for a comprehensive QIS (Quantitative Impact Study) to ensure its effectiveness.
• They recommend that resolution authorities also set a transitional period for banks undergoing or having undergone a resolution process.

8. Market Confusion and Clarity

• The BSG warns that the draft RTS may create market confusion due to excessive flexibility.
• They advocate for clearer regulations, especially regarding the inclusion of senior liabilities in MREL, to restore a level playing field between European and non-European banks.

9. Special Cases

• For promotional banks that are public sector entities with explicit guarantees, the MREL requirement should reflect the exceptionally low risk.
• The BSG also calls for clarification on the recognition of counterparty netting rights in the context of MREL calculation.

Conclusion

The BSG sees the draft RTS as a step in the right direction but stresses the need for clarity, consistency, and proportionality in its implementation. They advocate for a balanced approach that supports resolvability without introducing unnecessary costs or market distortions.