[ParlTrack]

Proposal for a regulation
Recital 10

(10) The application of IFRS 9 during the economic downturn caused by the COVID-19 pandemic may lead to a sudden significant increase in (i) expected credit loss provisions, as for many exposures expected losses over their lifetime may need to be calculated, for assets at amortized cost; and (ii) net unrealised losses on assets measured at fair value through other comprehensive income (OCI). The BCBS agreed on 3 April 2020 to allow more flexibility in the implementation of the transitional arrangements that phase in the impact of IFRS 9. In order to limit the possible volatility of regulatory capital that may occur if the COVID-19 crisis results in a significant increase in expected credit loss provisions, it is necessary to extend the transitional arrangements also in Union law.

2020/05/27
Committee: ECON

Fabio Massimo CASTALDO

Proposal for a regulation
Recital 11

(11) To mitigate the potential impact that a sudden increase in expected credit loss provisions and net unrealised losses on assets measured at fair value through OCI may have on institutions’ capacity to lend to clients at times when it is most needed, the transitional arrangements should be extended by two years and institutions should be allowed to fully add- back to their Common Equity Tier 1 capital any increase in new expected credit loss provisions and net unrealised losses on assets measured at fair value through OCI that they recognise in 2020 and 2021 for their financial assets, which are not credit-impaired. This would bring additional relief to the impact of the COVID-19 crisis on institutions’ possible rise in provisioning needs and unrealised losses under IFRS 9 while maintaining the transitional arrangements for the expected credit loss amounts established before the pandemic of COVID-19.

2020/05/27
Committee: ECON

Fabio Massimo CASTALDO

Proposal for a regulation
Article 1 – paragraph 1 – point -1 (new)

Regulation (EU) No 575/2013
Article 47c – paragraph 3 a (new)

(-1) In Article 47c, the following subparagraph is inserted: “3a. By way of derogation from paragraph 2 and 3, where the exposure is classified as non-performing by the last day of year 2023, the applicable factors shall be applied by adding 24months to the date indicated thereof.”

2020/05/27
Committee: ECON

Fabio Massimo CASTALDO

Proposal for a regulation
Article 1 – paragraph 1 – point -1 (new)

Regulation (EU) No 575/2013
Article 366 – paragraph 4 – subparagraph 1 a (new)

(-1) In Article 366(4), the following subparagraph is added: “Competent authorities may in individual cases exclude the over shootings that do not result from deficiencies in the internal model and that have occurred in the calculation of the addend set out in Article 366(3).”

2020/05/27
Committee: ECON

Fabio Massimo CASTALDO

Proposal for a regulation
Article 1 – paragraph 1 – point 1

Regulation (EU) No 575/2013
Article 429a – paragraph 1 – point p a (new)

(aa) in paragraph 1, the following point is inserted: “(pa) European Monetary Union central governments securities and Central Banks exposures. This will be in effect until June 30, 2023, given the effects of the crisis and in the meantime of a final decision.”

2020/05/27
Committee: ECON

Fabio Massimo CASTALDO

Proposal for a regulation
Article 1 – paragraph 1 – point 2 – point b

Regulation (EU) No 575/2013
Article 473a – paragraph 3 – point b

(b) the sum of the 12-month expected credit losses determined in accordance with paragraph 5.5.5 of the Annex relating to IFRS 9 and the amount of the loss allowance for lifetime expected credit losses determined in accordance with paragraph 5.5.3 of the Annex relating to IFRS 9 excluding the loss allowance for lifetime expected credit losses for financial assets that are credit-impaired classified as such before 1 January 2020 as defined in Appendix A to the Annex relating to IFRS 9 as of 1 January 2020 or on the date of initial application of IFRS 9, whichever is later.;

2020/05/27
Committee: ECON

Fabio Massimo CASTALDO

Proposal for a regulation
Article 1 – paragraph 1 – point 2 – point d

Regulation (EU) No 575/2013
Article 473a – paragraph 6 – point a

(a) 0,785 during the period from 1 January 2020 to 31 December 20201;

2020/05/27
Committee: ECON

Fabio Massimo CASTALDO

Proposal for a regulation
Article 1 – paragraph 1 – point 2 – point d

Regulation (EU) No 575/2013
Article 473a – paragraph 6 – point b

(b) 0,570 during the period from 1 January 20212 to 31 December 20212;

2020/05/27
Committee: ECON

Fabio Massimo CASTALDO

Proposal for a regulation
Article 1 – paragraph 1 – point 2 – point d

Regulation (EU) No 575/2013
Article 473a – paragraph 6 – point c

(c) 0,250 during the period from 1 January 20223 to 31 December 20224;

2020/05/27
Committee: ECON

Fabio Massimo CASTALDO

Proposal for a regulation
Article 1 – paragraph 1 – point 2 – point d

(d) 0,25 during the period from 1 January 20234 to 31 December 2024.

2020/05/27
Committee: ECON

Fabio Massimo CASTALDO

Proposal for a regulation
Article 1 – paragraph 1 – point 2 – point f – point ii

Regulation (EU) No 575/2013
Article 473a – paragraph 7 –

(ii) the following subparagraph is inserted: ‘ When recalculating the requirements laid down in this Regulation and in Directive 2013/36/EU for the purpose of the first subparagraph, the amount ABSA referred to in point (a) of the second subparagraph of paragraph 1 shall be assigned a risk weight of 100 %.;’deleted

2020/05/27
Committee: ECON

Fabio Massimo CASTALDO

Proposal for a regulation
Article 1 – paragraph 1 – point 2 a (new)

Regulation (EU) No 575/2013
Article 473a a (new)

(2a) The following article is inserted: "Article 473aa 1. By way of derogation from Article 35 and until the end of the transitional period set out in paragraph 2 of this Article, the following may include in their Common Equity Tier 1 capital the amount “A” calculated in accordance with the following formula: A= (a) x f Where: (a) is the increasing of net unrealized losses from 31 December 2019 accounted in “Fair value changes of debt instruments measured at fair value through other comprehensive income”. 2. Institutions shall apply the following factors “f” to calculate the amount A referred in the first paragraph: (a) 1 during the period from 1 January 2020 to 31 December 2020; (b) 1 during the period from 1 January 2021 to 31 December 2021; (c) 0,75 during the period from 1 January 2022 to 31 December 2022; (d) 0,50 during the period from 1 January 2023 to 31 December 2023; (e) 0,25 during the period from 1 January 2024 to 31 December 2024. 3. An institution shall decide whether to apply the arrangements set out in this Article during the transitional period and shall inform the competent authority of its decision by ………. 2020. Where an institution has received the prior permission of the competent authority, it may reverse once, during the transitional period, its initial decision.”

2020/05/27
Committee: ECON

Fabio Massimo CASTALDO

Proposal for a regulation
Article 1 – paragraph 1 – point 3

Regulation (EU) No 575/2013
Article 500a – paragraph 1

By way of derogation from Article 47c(3), ~~until [date of entry into force of this amending Regulation + 7 years]~~ the factors set out in Article 47c(4) shall also apply to the part of the non- performing exposure guaranteed by an eligible provider referred to in points (a) to (e) of Article 201(1), where, subject to compliance with Union State aid rules, where applicable, the guarantee or counter- guarantee is provided as part of support measures to assist borrowers amid the COVID-19 pandemic.

2020/05/27
Committee: ECON

Fabio Massimo CASTALDO

Proposal for a regulation
Article 1 – paragraph 1 – point 3a

(3a) points (b), (d), (g), (i) and (l) of Article 501a(1) are deleted.

2020/05/27
Committee: ECON

14 Amendments of Fabio Massimo CASTALDO related to 2020/0066(COD)

ParlTrack - 2011-2024