Version in force , Modified +2,391 −0§
Amended by Directive (EU) 2024/1174 32024L1174 on EUR-Lex (external, EUR-Lex)
Explanation, written by a model and checked against the cited text
A new paragraph 2a is added, stating that the Board shall not determine the requirement referred to in Article 12a(1) for liquidation entities.
The new paragraph 2a also allows the Board to assess whether determining that requirement for a liquidation entity on an individual basis, in an amount exceeding the loss-absorption amount under paragraph 2(a), is justified, listing own funds, eligible liabilities meeting Article 72a criteria (with named exceptions), and liabilities referred to in Article 12c(2) as the means of meeting such a requirement.
It further states that Article 77(2) and Article 78a of Regulation (EU) No 575/2013 do not apply to liquidation entities for which the Board has not set the requirement, that holdings of own funds and eligible liabilities instruments issued by such subsidiary liquidation entities are not deducted under Article 72e(5) of that Regulation, and that an institution or entity that is a subsidiary of a resolution entity or of a would-be resolution entity third-country entity must deduct such holdings in same-group liquidation entities once the aggregate reaches or exceeds 7% of the relevant own funds and liabilities total, calculated annually as of 31 December as a 12-month average; no such provisions exist in the earlier text.
Cited: Art. 12d, v2 (external, EUR-Lex) · Art. 12d, v1 (external, EUR-Lex)
v1 is the previous version, v2 this one.
Text from EUR-Lex, before and after
Previous version, in force 13 May 2024 02014R0806-20240513 → this version, in force 14 November 2024 02014R0806-20241114
Article 12d Determination of the minimum requirement for own funds and eligible liabilities 1. The requirement referred to in Article 12a(1) shall be determined by the Board, after consulting the competent authorities, including the ECB, on the basis of the following criteria: (a) … 517 unchanged words … point (a) of the first subparagraph. The assessment by the Board shall evaluate, in particular, the limit referred to in the second subparagraph as regards any possible impact on financial stability and on the risk of contagion to the financial system. 2a. The Board shall not determine the requirement referred to in Article 12a(1) for liquidation entities. By way of derogation from the first subparagraph, the Board may assess whether it is justified to determine the requirement referred to in Article 12a(1) for a liquidation entity on an individual basis in an amount exceeding the amount sufficient to absorb losses in accordance with paragraph 2, point (a), of this Article. The Board shall take into account in its assessment, in particular, any possible impact on financial stability and on the risk of contagion to the financial system, including with regard to the financing capacity of deposit guarantee schemes. Where the Board determines the requirement referred to in Article 12a(1), the liquidation entity shall meet that requirement by using one or more of the following: (a) own funds; (b) liabilities that fulfil the eligibility criteria referred to in Article 72a of Regulation (EU) No 575/2013, with the exception of Article 72b(2), points (b) and (d), of that Regulation; (c) the liabilities referred to in Article 12c(2). Article 77(2) and Article 78a of Regulation (EU) No 575/2013 shall not apply to liquidation entities for which the Board has not determined the requirement referred to in Article 12a(1) of this Regulation. Holdings of own funds instruments and eligible liabilities instruments issued by subsidiary institutions which are liquidation entities for which the Board has not determined the requirement referred to in Article 12a(1) shall not be deducted under Article 72e(5) of Regulation (EU) No 575/2013. By way of derogation from the fourth subparagraph, an institution or entity referred to in Article 2 that is not itself a resolution entity but is a subsidiary of a resolution entity or of a third-country entity that would be a resolution entity if it were established in the Union shall deduct its holdings of own funds instruments in subsidiary institutions that belong to the same resolution group and that are liquidation entities for which the Board has not determined the requirement referred to in Article 12a(1) where the aggregate amount of those holdings is equal to or exceeds 7 % of the total amount of its own funds and liabilities that comply with the eligibility criteria specified in Article 12g(2), calculated annually as of 31 December as an average over the previous 12 months. 3. For resolution entities, the amount referred to in the first subparagraph of paragraph 2 shall be the following: (a) for the purpose of calculating the requirement referred to in Article 12a(1), in accordance with point (a) of Article 12a(2), the … 2,050 unchanged words … the transitional provisions laid down in Chapters 1, 2 and 4 of Title I of Part Ten of Regulation (EU) No 575/2013 and in the provisions of national legislation exercising the options granted to the competent authorities by that Regulation.