EBA · 2019_4685 Rejected question

Place in the sequence of write down for an istrument that does not qualify as part of own funds

Regulation
Directive 2014/59/EU (BRRD)
Article
48, para. 1
Topic
Write-down and conversion of capital instruments
Submitted by
Credit institution
Submitted
2019-04-26
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Question

Where does an instrument that qualified as original own funds under the national transposition measure for point (ca) of Article 57 of Directive 2006/48/EC but does not qualify as Additional Tier 1 according to Article 489(4) fit in the sequence of write down and conversion from Article 48 of Directive 2014/59/EU? Will 48(1)(b), 48(1)(c) or 48(1)(d) be applicable to such an instrument?

Background

A number of hybrid Tier 1 instruments no longer form part of own funds following introduction of the regulation (EU) No 575/2013. Directive 2014/59/EU links write down sequence to the regulatory treatment of an instrument which might require further clarification in case a subordinated instrument does not have regulatory recognition.
No answer published yet.

Original source: European Banking Authority, Q&A ID 2019_4685

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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