EBA · 2014_1384 Rejected question

Treatment of subordinated loans in respect of Art 133 (3) CRR

Regulation
Regulation (EU) No 575/2013 (CRR)
Article
133, para. 3
Topic
Own funds
Submitted by
Credit institution
Submitted
2014-07-23
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Question

Could you please confirm that subordinated loans according to Art 62.a CRR, which are acknowledged as Tier 2 are not regarded as equity exposures according to Art. 133.3 CRR.

Background

The term " regulatory capital instruments" used in Article 133.3 CRR is not defined in the CRR. Therefore it is questionable whether items like subordinated loans acc. to Article 62.a CRR have to be treated as regulatory capital instruments and therefore be qualified as equity exposures in the sense of Art. 133.3 or only capital instruments that are securitized and emitted as securities.
No answer published yet.

Original source: European Banking Authority, Q&A ID 2014_1384

This Q&A is published by European Banking Authority and is non-binding. It does not constitute legal advice. Updated weekly from official ESA sources.

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