Transitional provisions under the IFR (Regulation 2019/2033)

How should the “twice the relevant own funds requirement pursuant to Chapter 1 of Title I of Part Three of Regulation (EU) No 575/2013”, referred to in article 57(3)(a) of Regulation 2019/2033 be understood?

According to article 57(1)(a) of the IFR: By way of derogation from points (a) and (c) of Article 11(1), investment firms may apply lower own funds requirements for a period of five years from 26 June 2021, equal to: (a) twice the relevant own funds requirement pursuant to Chapter 1 of Title I of Part Three of Regulation (EU) No 575/2013, subject to Article 93(1) of that Regulation, with reference to levels of initial capital set by Title IV of Directive 2013/36/EU, as amended by Directive (EU) 2019/878, that would have applied if the investment firm had continued to be subject to the own funds requirements of that Regulation as amended by Regulation (EU) 2019/630. From the wording of the article it is not clear whether in the transitional period investment firms applying the provision should: 1) calculate Own Funds and Own Funds Requirements in accordance with the CRR as: a. Total Capital Ratio > 2*8%, b. Tier I Capital Ratio > 2*6%, c. Common Equity Tier I Ratio > 2*4,5%; or: 2) calculate Own Funds in accordance with article 9 of the IFR, and instead of the own funds requirements referred to in article 11(a) and (c) of the IFR, calculate twice the relevant own funds requirement in accordance with the CRR as: 2*8%*Total risk exposure.