EBA · 2016_2660 Final Q&A

Exemption from cap of inflows per Article 33 (1) of the Commission Delegated Act 2015/61

Regulation
Regulation (EU) No 575/2013 (CRR)
Article
425, para. 1
Topic
Liquidity risk
Submitted by
Competent authority
Submitted
2016-03-04
Answered
2016-09-23
Answer provided by
ESAs (EBA, ESMA, EIOPA)
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Question

(a) Can the national competent authority of a Member State grant such exemption where the inflow arises from the parent companies or subsidiaries incorporated in third countries? (b) If the reply to the first question is positive, shall the national competent authority carry out an assessment as required under the draft regulation to be issued by the ECB under Article 425(5) of the CRR and Article 34(1)(2) and (3) of the Commission Delegated Regulation (EU) 2015/61 or shall the national competent authority follow other national guidelines?

Background

According to Article 33(2)(a) of the Delegated Act 2015/61, a credit institution may fully or partially be exempted from the cap on inflows (75% of outflows) where the provider is a parent or a subsidiary within the same group of the institution subject to the approval of the national competent authority. In view of Article 33(2)(a) of the Delegated Act and Article 425(1) of the CRR, can a national competent authority grant an exemption on the cap of inflows to an institution authorised in a Member State whose inflows arise from a third country parent bank and a branch (of the same parent bank) incorporated in the UK?

Answer

According to Article 33(2)(a) of the Delegated Regulation (EU) 2015/61 subject to prior approval of the competent authority a credit institution may be fully or partially exempted from the cap on inflows (75% of outflows) where the provider is an intragroup entity irrespective of the country of residence. An exemption may be granted on case-by-case basis according to the policy of the competent authority that supervises the credit institution.

Original source: European Banking Authority, Q&A ID 2016_2660

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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