Regulation (EU) 2022/504 of the European Central Bank of 25 March 2022 amending Regulation (EU) 2016/445 on the exercise of options and discretions available in Union law (ECB/2016/4) (ECB/2022/14)
Regulation (EU) 2022/504 of the European Central Bankof 25 March 2022amending Regulation (EU) 2016/445 on the exercise of options and discretions available in Union law (ECB/2016/4) (ECB/2022/14)THE GOVERNING COUNCIL OF THE EUROPEAN CENTRAL BANK,Having regard to the Treaty on the Functioning of the European Union,Having regard to Council Regulation (EU) No 1024/2013 of 15 October 2013 conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutionsOJ L 287, 29.10.2013, p. 63., and in particular Article 4(3), Article 6, and Article 9(1) and (2) thereof,Having regard to Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and amending Regulation (EU) No 648/2012OJ L 176, 27.6.2013, p. 1., and in particular Articles 400(2), 415(3), 420(2), 428p(10), 428q(2), 428aq(10), 428ar(2), 467(3), 468(3) and 471(1) thereof,Having regard to Commission Delegated Regulation (EU) 2015/61 of 10 October 2014 to supplement Regulation (EU) No 575/2013 of the European Parliament and the Council with regard to liquidity coverage requirement for Credit InstitutionsOJ L 11, 17.1.2015, p. 1., and in particular Articles 12(3) and 23(2), and Article 24(4) and (5) thereof,Whereas:(1)Legislation adopted since the adoption of Regulation (EU) 2016/445 of the European Central Bank (ECB/2016/4)Regulation (EU) 2016/445 of the European Central Bank of 14 March 2016 on the exercise of options and discretions available in Union law (ECB/2016/4) (OJ L 78, 24.3.2016, p. 60). has introduced certain new options and discretions into Union law and has also amended or deleted certain options and discretions provided in Union law that the European Central Bank (ECB) exercised in Regulation (EU) 2016/445 (ECB/2016/4). Therefore, consequential amendments to Regulation (EU) 2016/445 (ECB/2016/4) are necessary to reflect those changes.(2)Further, pursuant to Article 9(3) of Regulation (EU) 2016/445 (ECB/2016/4), intragroup exposures are exempted from the relevant large exposures limits, provided that credit institutions fulfil certain criteria. Since the adoption of Regulation (EU) 2016/445 (ECB/2016/4) the level of the ECB’s prudential concern about credit institutions’ booking practices involving entities established in third countries has increased. The scope of Article 9(3) of Regulation (EU) 2016/445 (ECB/2016/4) should therefore be limited to intragroup exposures to entities established within the Union.(3)Article 9(3) and (4) of Regulation (EU) 2016/445 (ECB/2016/4) should be amended to allow that, in addition to the full exemption currently available, credit institutions that comply with the relevant criteria by observing a quantitative limit on the value of the relevant exposures are able to make use of a partial exemption.(4)In relation to trade finance off-balance-sheet related products, the ECB considers it necessary to introduce greater flexibility in the determination of outflow rates for the purposes of Article 23(2) of Commission Delegated Regulation (EU) 2015/61Commission Delegated Regulation (EU) 2015/61 of 10 October 2014 to supplement Regulation (EU) No 575/2013 of the European Parliament and the Council with regard to liquidity coverage requirement for credit institutions (OJ L 11, 17.1.2015, p. 1).. Therefore, the specification of a standardised 5 % outflow rate in Article 11 of Regulation (EU) 2016/445 (ECB/2016/4) should be removed. Instead, as is the case for the other products and services that fall within the scope of Article 23 of Delegated Regulation (EU) 2015/61, the ECB should determine outflow rates for trade finance off-balance-sheet related products by either accepting the outflow rates applied by the relevant credit institution or by setting a higher outflow rate, capped at 5 %.(5)To support the objective of consistent application of prudential requirements to credit institutions, a general policy for identifying major stock indices in a Member State or in a third country for the purposes of Article 12(1)(c)(i) of Delegated Regulation (EU) 2015/61 should be established.(6)With the introduction of the net stable funding ratio (NSFR) requirement as set out in Title IV of Part Six of Regulation (EU) No 575/2013, competent authorities are empowered to exercise several new options and discretions relating to the NSFR requirement. Regulation (EU) 2016/445 (ECB/2016/4) should, therefore, be updated accordingly.(7)To support the principle of equal treatment of credit institutions, options and discretions relating to the application of the NSFR requirement by small and non-complex institutions, as described in Chapter 5 of Title IV of Part Six of Regulation (EU) No 575/2013, should be exercised in the same way as the corresponding options and discretions relating to the application of the NSFR requirement by other credit institutions, as set out in Chapters 1 to 4 of Title IV of Part Six of Regulation (EU) No 575/2013.(8)Certain factors have impeded the practical application of the discretion addressed in Article 13 of Regulation (EU) 2016/445 (ECB/2016/4) whereby competent authorities may authorise institutions to apply a 3 % outflow rate to stable retail deposits covered by a deposit guarantee scheme (DGS), subject to the prior approval of the European Commission in accordance with Article 24(4) and (5) of Delegated Regulation (EU) 2015/61. Further evidence and analysis are necessary in order to demonstrate that the run-off rates for stable retail deposits covered by a DGS as referred to in Article 24(5) of Delegated Regulation (EU) 2015/61 would be below 3 % during any stress period experienced consistent with the scenarios referred to in Article 5 of Delegated Regulation (EU) 2015/61. In the absence of such evidence and analysis, the general policy authorising the application of a 3 % outflow rate should be removed from Regulation (EU) 2016/445 (ECB/2016/4).(9)In accordance with the procedure set out in Article 4(3) of Regulation (EU) No 1024/2013, the ECB has conducted an open public consultation on this Regulation.(10)The decision of the Supervisory Board of the ECB to approve the proposal to adopt this Regulation has been taken in accordance with Article 26(7) of Regulation (EU) No 1024/2013.(11)Therefore, Regulation (EU) 2016/445 (ECB/2016/4) should be amended accordingly,HAS ADOPTED THIS REGULATION: