[ParlTrack]

Proposal for a regulation
Recital 13

(13) The Basel Committee is currently considering the introduction of a leverage ratio surcharge for globally systemically important banks (G-SIBs). The final outcome of the Basel Committee's calibration workFor institutions that are designated globally systemically important institutions (G-SIIs) because of their size, interconnectedness, complexity, irreplaceable nature or global relevance, a leverage ratio surcharge should be introduced, on account of the too-big-to- fail problem. European legislation should take into account the strict leverage ratios which already exist in other jurisdictions in order to effectively counteract these negative externalities. Furthermore, a surcharge of this kind for G-SIIs is readily implementable since G-SIIs in the Union already significantly exceed a leverage ratio of 3%1a. The leverage ratio for G-SIIs should ~~giv~~be raised to a ~~discussion on the appropriate calibration of the leverage ratio for s~~total of 5%. __________________ 1a Basel Committee on Banking Supervision, Basel III Monitoring Report, February 2017: http://www.bis.org/bcbs/publ/d397.pdf (p.49). Economic Governance Support Unit (EGOV) of the European Parliament, Briefing: Global Systemically iImportant ~~EU institutions.~~ Banks in Europe (PE 574.406): http://www.europarl.europa.eu/RegData/e tudes/BRIE/2016/574406/IPOL_BRI(201 6)574406_EN.pdf (p.7).

2018/02/02
Committee: ECON

Paul TANG, Jakob von WEIZSÄCKER, Cătălin Sorin IVAN

Proposal for a regulation
Recital 13 a (new)

(13a) To prevent an institution from paying out own funds, even though its capital position is weak, a buffer on top of the prescribed leverage ratio should be met. Should the institution fail to meet this buffer, the institution is prohibited from distributing its own capital to shareholders and management, until the capital position meets the minimum leverage ratio plus the leverage ratio buffer requirement (LRBR).

2018/02/02
Committee: ECON

Paul TANG, Jakob von WEIZSÄCKER

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

Regulation (EU) No 575/2013
Article 4 – paragraph 1 – point 144 a (new)

(144a) ‘small and non-complex institution’ means an institution which fulfils all of the following criteria: (a) the total value of the assets at the consolidated level, or, in the case of institutions controlled by a parent undertaking, a financial holding company or a mixed financial holding company, the total value of assets of the parent entity at the consolidated level is less than or equal to EUR 1,5 billion; (b) the resolution assessment in accordance with Articles 15 and 16 of Directive 2014/59/EU concludes that the liquidation of the institution in normal insolvency proceedings is feasible and credible; (c) the institution is not a large institution within the meaning of Article 4(1) point 144b; (d) its trading activities are classified as low within the meaning of Article 94; (e) the total value of its derivative exposures is less than or equal to 2% of its total on- and off-balance sheet assets, where only derivatives which qualify as positions held with trading intent are included in calculating the derivative exposures; (f) the institution does not use internal models for calculating own funds requirements; (g) the institution has not communicated to the competent authority an objection to being classified as a small and non- complex institution; (h) the competent authority has not decided that the institute is not to be considered a small and non-complex institution based on an analysis of its size, connectivity, complexity or risk profile. Within the Single Supervisory Mechanism the threshold in point (a) can be adjusted upward or downward for an institution, taking into consideration the total value of assets of the parent entity at the consolidated level in relation to the GDP of the member state of the institution.

2018/02/02
Committee: ECON

Paul TANG, Jakob von WEIZSÄCKER

Proposal for a regulation
Article 1 – paragraph 1 – point 39 – point a

Regulation (EU) No 575/2013
Article 92 – paragraph 1 – point d

(d) a leverage ratio of 35%..

2018/02/05
Committee: ECON

Paul TANG, Jakob von WEIZSÄCKER

Proposal for a regulation
Article 1 – paragraph 1 – point 39 – point a a (new)

Regulation (EU) No 575/2013
Article 92 – paragraph 1 – point d a (new)

(aa) in paragraph 1, the following point (d a) is added: "(da) By way of derogation from point d, a leverage ratio of 5% for institutions which are G-SIIs or part of a G-SII;"

2018/02/05
Committee: ECON

Paul TANG, Jakob von WEIZSÄCKER, Cătălin Sorin IVAN

Proposal for a regulation
Article 1 – paragraph 1 – point 40

Regulation (EU) No 575/2013
Article 92 -a (new)

(40) The following Article 92 -a is inserted: Article 92 -a 1. An institution that fails to keep a leverage ratio of at least 5%, the leverage ratio buffer requirement (LRBR), shall be prohibited from making a distribution in connection with its own funds to an extent that would decrease its leverage ratio. 2. Institutions that fail to meet the leverage ratio buffer requirement (LRBR) shall notify the competent authority and any such institution is prohibited from undertaking any of the following actions before it has fulfilled the requirement of paragraph 1: (a) make a distribution of its own funds that would decrease its leverage ratio; (b) pay variable remuneration or discretionary pension benefits; (c) make payments on own funds instruments. 3. The restrictions imposed by this Article shall only apply to payments that result in a reduction of own funds or in a reduction of profits, and where a suspension of payment or failure to pay does not constitute an event of default or a condition for the commencement of proceedings under the insolvency regime applicable to the institution. 4. Where an institution fails to meet the leverage ratio buffer requirement (LRBR) and still intends to distribute any of its distributable profits or undertake an action referred to in points (a), (b) and (c) of the second subparagraph of paragraph 2, it shall first obtain permission from the competent authority and provide the following information: (a) the amount of capital maintained by the institution, subdivided as follows: (i) Common Equity Tier 1 capital, (ii) Additional Tier 1 capital, (iii) Tier 2 capital; (b) the amount of its interim and year- end profits; (c) the amount of distributable profits it intends to allocate between the following: (i) dividend payments, (ii) share buy backs, (iii) payments on Additional Tier 1 instruments, (iv) the payment of variable remuneration or discretionary pension benefits. 5. Institutions shall maintain arrangements to ensure that the leverage ratio buffer is calculated accurately, and shall be able to demonstrate that accuracy to the competent authority on request. 6. For the purposes of paragraphs 1 and 2, a distribution in connection with its own funds shall include the following: (a) a payment of cash dividends; (b) a distribution of fully or partly paid bonus shares or other capital instruments referred to in Article 26(1)(a) of this Regulation; (c) a redemption or purchase by an institution of its own shares or other capital instruments referred to in Article 26(1)(a) of this Regulation; (d) a repayment of amounts paid up in connection with capital instruments referred to in Article26(1)(a) of this Regulation; (e) a distribution of items referred to in points (b) to (e) of Article 26(1) of this Regulation.

2018/02/05
Committee: ECON

Paul TANG, Jakob von WEIZSÄCKER

Proposal for a regulation
Article 1 – paragraph 1 – point 42

(e) recommend amendments of Implementing Regulation (EU) No 680/2014 to reduce the reporting burden on institutions or specified categories of institutions where appropriate having regard to the objectives of this Regulation and Directive 2013/36/EU. The report shall, at a minimum, make recommendations on how technical standards and guidelines can create uniform reporting formats to reduce the level of granularity of reporting requirements for small and non-complex institutions as defined in Article 430a.

2018/02/05
Committee: ECON

Paul TANG, Jakob von WEIZSÄCKER, Udo BULLMANN, Marco VALLI

Proposal for a regulation
Article 1 – paragraph 1 – point 116

Regulation (EU) No 575/2013
Article 449 a (new)

Article 449a Disclosure of the climate-related risks 1. From... [3 years after entry into force of this Regulation], institutions disclose the following information on climate-related risks in accordance with Article 84a of Directive 2013/36/EU, and in alignment with the recommendations from the Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD): (a) A description of the specific problems relating to climate, which could arise in the short, medium, or long-term and could have a material or financial impact on the institution, and whether these are physical or transition risks; (b) A description of the processes that are used to determine which risks could have a material or financial impact on the institution and how these are integrated into the overall risk management; (c) A description of significant concentrations of credit exposures against carbon-related assets, if these are material. This should include a forward- looking climate scenario analysis assessing how the lending portfolio aligns with the Paris Agreement’ objective of limiting global warming well below 2°C, as recommended by the TCFD (d) A description of the impact of climate-related risks on the business, strategy and financial planning of the institution, if these are material; (e) A description of the processes that the institution uses to identify, evaluate and manage risks; (f) The parameters and metrics that the institution used to evaluate the impact of short-, medium- and long-term climate- related risks on lending and financial intermediary services, if these are material; (g) A description of the role of the board with regard to the evaluation and management of climate-related risks. 2. The management body, as defined in article 88 of 2013/36/EU, will sign for the correctness of the information on climate-related risks described in this article. 3. For the purpose of implementing the definition referred to in this article the EBA may prepare draft technical regulatory standards.

2018/02/05
Committee: ECON

Paul TANG, Udo BULLMANN, Marco VALLI

Proposal for a regulation
Article 1 – paragraph 1 – point 127

Regulation (EU) No 575/2013
Article 501 d a (new)

Article 501da Support factor for green assets 1. Risk-weighted exposure amounts for green exposures to corporates, used for a unit that exists or was created to finance, refinance or operate green assets as described in paragraph 3, and which meet the prudential criteria as set out in Article 501a(1)(c)-(n) and Article 501a(2), shall be adjusted in accordance with the following formulae: (i) if E' <= EUR 1 500 000, RW* = RW 0.7612; (ii) if E' > EUR 1 500 000, RW* = min {RW; EUR 1500 000} * 0.7612 + max {0; RW – 1 500 000} * 0.85; where: RW* = adjusted risk-weighted exposure amount for green exposure; E' = the total amount in green exposures owed to the institution and parent undertakings and its subsidiaries, including any exposure in default, by the obligor client or group of connected clients, but excluding claims or contingent claims secured on residential property collateral; RW= risk-weighted exposure amount for green exposure, calculated in accordance with Part II, Title II and this Article. 2. For the purpose of this Article, the following shall apply: The Commission is empowered supplement this Regulation by adopting delegated acts in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010 to define a carbon footprint methodology, in order to compile a list of exposures that are defined as green exposures. For the purpose of implementing the definition referred to in this paragraph and the compilation of the green exposures list, the EBA shall prepare draft technical regulatory standards. The EBA shall submit those draft regulatory technical standards to the Commission by ... [two years after entry into force of this Regulation]. 4. Institutions shall report the total amount of green assets, calculated in accordance with paragraph 2, to the relevant authorities every three months. 5. The EBA shall, [three years after entry into force of this regulation], report to the Commission on the impact of the own funds requirement on the financing of, and investment in, green assets. For the purposes of this article, the EBA report to the Commission shall include the following: (a) An analysis of the developments in financing and investments in green assets over the period specified in in this paragraph; (b) An analysis of the effective risk profile of green assets over an entire economic cycle; (c) Any additional points which the EBA regards as important in this report. 6. The Commission shall submit this report to the European Parliament and the Council, accompanied by a legislative proposal if considered necessary. 7. The Green Support Factor cannot for the same assets be combined with the SME support factor referred to in Article 501, the infrastructure support factor referred to in Article 501a or the support factor for social enterprises referred to in Article 501db.

2018/02/05
Committee: ECON

Paul TANG, Jakob von WEIZSÄCKER, Udo BULLMANN, Marco VALLI

Proposal for a regulation
Article 1 – paragraph 1 – point 127

Regulation (EU) No 575/2013
Article 501 d a (new)

Article 501da Penalising factor for brown assets 1. Risk-weighted exposure amounts for brown exposures, used for a unit that exists or was created to finance, refinance or operate brown assets as described in paragraph 2, shall be adjusted in accordance with the following formulae: (i) if E' <= EUR 1 500 000, RW** = RW 1.15; (ii) if E' > EUR 1 500 000, RW* = min {RW; EUR 1500 000} * 1.15 + max {0; RW – 1 500 000} * 1.2388; where: RW** = adjusted risk-weighted exposure amount for brown exposure; E' = the total amount owed in brown exposures to the institution and parent undertakings and its subsidiaries, including any exposure in default, by the obligor client or group of connected clients, but excluding claims or contingent claims secured on residential property collateral; RW= risk-weighted exposure amount for brown exposure, calculated in accordance with Part II, Title II and this Article. 2. For the purpose of this Article, the following shall apply: The Commission is empowered supplement this Regulation by adopting delegated acts in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010 to define a carbon footprint methodology, in order to compile a list of exposures that are defined as brown exposures, taking into account the transition of institutions to a low carbon strategy. For the purpose of implementing the definition referred to in this paragraph and the compilation of the brown exposures list, the EBA shall prepare draft technical regulatory standards. The EBA shall submit those draft regulatory technical standards to the Commission by ... [two years after entry into force of this Regulation]. 3. Institutions shall report the total amount of brown assets, calculated in accordance with paragraph 2, to the relevant authorities every three months. 4. The EBA shall, [three years after entry into force of this regulation], report to the Commission on the impact of the own funds requirement on the financing of, and investment in, brown assets. For the purposes of this article, the EBA report to the Commission shall include the following: (a) An analysis of the developments in financing and investments in brown assets over the period specified in this paragraph; (b) An analysis of the effective risk profile of brown assets over an entire economic cycle; (c) Any additional points which the EBA regards as important in this report. 6. The Commission shall submit this report to the European Parliament and the Council, accompanied by a legislative proposal if considered necessary.

2018/02/05
Committee: ECON

10 Amendments of Paul TANG related to 2016/0360A(COD)

ParlTrack - 2011-2024