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European Parliament 2014-2019 Committee on Economic and Monetary Affairs 2016/0360A(COD) 5.2.2018 AMENDMENTS 686 - 935 Draft report Peter Simon (PE613.409v03-00) on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EU) No 575/2013 as regards the leverage ratio, the net stable funding ratio, requirements for own funds and eligible liabilities, counterparty credit risk, market risk, exposures to central counterparties, exposures to collective investment undertakings, large exposures, reporting and disclosure requirements and amending Regulation (EU) No 648/2012 Proposal for a regulation (COM(2016)0850 – C8-0480/2016 – 2016/0360A(COD)) AM\1144448EN.docx PE616.835v01-00 EN United in diversity EN
Transcript

European Parliament2014-2019

Committee on Economic and Monetary Affairs

2016/0360A(COD)

5.2.2018

AMENDMENTS686 - 935Draft reportPeter Simon(PE613.409v03-00)

on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EU) No 575/2013 as regards the leverage ratio, the net stable funding ratio, requirements for own funds and eligible liabilities, counterparty credit risk, market risk, exposures to central counterparties, exposures to collective investment undertakings, large exposures, reporting and disclosure requirements and amending Regulation (EU) No 648/2012

Proposal for a regulation(COM(2016)0850 – C8-0480/2016 – 2016/0360A(COD))

AM\1144448EN.docx PE616.835v01-00

EN United in diversity EN

AM_Com_LegReport

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Amendment 686Marco Zanni, Bernard Monot, Gerolf AnnemansProposal for a regulationArticle 1 – paragraph 1 – point 88Regulation (EU) No 575/2013Chapter 5

Text proposed by the Commission Amendment

(88) In Title IV of Part Three, the Title of Chapter 5 is replaced by the following:

(88) In Title IV of Part Three, Chapter 5 is deleted.

Or. en

Justification

Chapter 5 aims to regulate the simplified IRB approach, so it must be deleted due to the position taken on IRB models.

Amendment 687Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 91Regulation (EU) No 575/2013Article 390 – paragraph 4 – subparagraph 1

Text proposed by the Commission Amendment

Institutions shall calculate exposures arising from contracts referred to in Annex II and credit derivatives directly entered into with a client in accordance with one of the methods set out in Part Three, Title II, Chapter 6, Section 3 to Section 5, as applicable.

Institutions shall calculate exposures arising from contracts referred to in Annex II and credit derivatives directly entered into with a client in accordance with one of the methods set out in Part Three, Title II, Chapter 6, Section 3 to Section 6, as applicable. Institutions with a permission to use the Internal Model Method in accordance with Article 283 may use the Internal Model Method for calculating the exposure value for all transactions for which they have received permission under Article 283.

Or. en

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Justification

The Internal model Method is still permitted to be used by banks for some products in the revised CRR. Therefore, in calculating exposure under the Large exposure regime, the IMM should be allowed.

Amendment 688Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 91Regulation (EU) No 575/2013Article 390 – paragraph 4 – subparagraph 2

Text proposed by the Commission Amendment

Exposures arising from these contracts allocated to the trading book shall also fulfil the requirements set out in Article 299.

When calculating the exposure value for the contracts referred to in the first subparagraph which are allocated to the trading book, institutions shall also comply with the principles set out in Article 299. By derogation from the first subparagraph of this paragraph, institutions with a permission to use the Internal Model Method in accordance with Article 283 may use the method referred to in Part Three, Title II, Chapter 6, Section 6 for calculating the exposure value for securities financing transactions.

Or. en

Justification

This amendment shall clarify, in line with the Basel standard for measuring LE (para 34), a derogation from the requirements for calculating exposure value of securities financing transactions for the purpose of LE. Institutions that have a permission to use the IMM under CRR Article 283 may continue using this method.

Amendment 689Costas MavridesProposal for a regulationArticle 1 – paragraph 1 – point 93Regulation (EU) No 575/2013Article 392 – paragraph 1

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Text proposed by the Commission Amendment

An institution's exposure to a client or a group of connected clients shall be considered a large exposure where its value is equal to or exceeds 10 % of its Tier 1 capital..

An institution's exposure to a client or a group of connected clients shall be considered a large exposure where its value is equal to or exceeds 10 % of its eligible capital.

Or. en

Justification

Whilst, until the CRR entered into force, a bank’s entire own funds could be taken as the basis for calculating the large exposure limit, the inclusion of Tier 2 capital was, in particular, gradually restricted to a significant extent by the CRR. In its work, the Basel Committee focuses on international banks that are active in the capital markets. This has to be borne in mind when translating Basel proposals into European law. On no account should – as proposed by the Basel Committee – the basis for calculating the large exposure limit be reduced any further. Banks without corresponding access to the capital markets can only create Tier 1 capital to a limited extent to flexibly cushion against capital squeezes. Taking solely Tier 1capital as the basis for calculating the large exposure limit is not appropriate either, as in the event of default by a borrower Tier 2 capital can also be used to cover losses where an annual loss is involved.

Amendment 690Markus FerberProposal for a regulationArticle 1 – paragraph 1 – point 94Regulation (EU) No 575/2013Article 394 – paragraph 4 – subparagraph 3

Text proposed by the Commission Amendment

Power is conferred on the Commission to adopt the implementing technical standards referred to in the first Paragraph in accordance with Article 15 of Regulation (EU) No 1093/2010.

Power is conferred on the Commission to adopt the implementing technical standards referred to in the first Paragraph in accordance with Article 15 of Regulation (EU) No 1093/2010. The implementing technical standards shall enter into force one year after their adoption by the Commission.

Or. de

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Justification

The institutions concerned should be given sufficient time to transpose the implementing technical standards on reporting obligations.

Amendment 691Markus FerberProposal for a regulationArticle 1 – paragraph 1 – point 94Regulation (EU) No 575/2013Article 394 – paragraph 5

Text proposed by the Commission Amendment

5. EBA shall develop draft regulatory technical standards to specify the criteria for the identification of shadow banking entities referred to in paragraph 2.

deleted

In developing those draft regulatory technical standards, EBA shall take into account international developments and internationally agreed standards on shadow banking and shall consider whether:

(a) the relation with an individual or a group of entities may carry risks to the institution's solvency or liquidity position;

(b) entities that are subject to solvency or liquidity requirements similar to those imposed by this Directive and Regulation (EU) No 1093/2010 shall be entirely or partially excluded from the reporting obligations referred to in paragraph 2 on shadow banking entities.

EBA shall submit those draft regulatory technical standards to the Commission by [one year after entry into force of the Amending Regulation].

Power is delegated to the Commission to adopt the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010.

Or. de

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Justification

The EBA guidelines on limits for exposures to shadow banking enterprises which carry out banking activities outside a regulatory framework (EBA/GL/2015/20) already include a definition of shadow banking entities.

Amendment 692Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 95 – point aRegulation (EU) No 575/2013Article 395 – paragraph 1 – subparagraph 4

Text proposed by the Commission Amendment

By way of derogation from the first subparagraph, an institution identified as G-SII in accordance with Article 131 of Directive 2013/36/EU shall not incur an exposure to another institution identified as G-SII the value of which, after taking into account the effect of the credit risk mitigation in accordance with Articles 399 to 403, exceeds 15 % of its Tier 1 capital. An institution shall comply with such limit no later than within 12 months after it is identified as G-SII..

By way of derogation from the first subparagraph

– an institution shall not incur an exposure to another institution identified as G-SII in accordance with Article 131 of Directive 2013/36/EU the value of which, after taking into account the effect of the credit risk mitigation in accordance with Articles 399 to 403, exceeds 10 % of its Tier 1 capital. An institution shall comply with such limit no later than within 12 months after the counterparty is identified as G-SII

– an institution shall not incur an exposure to another institution identified as O-SII in accordance with Article 131 of Directive 2013/36/EU the value of which, after taking into account the effect of the credit risk mitigation in accordance with Articles 399 to 403, exceeds 15 % of its Tier 1 capital. An institution shall comply with such limit no later than within 12

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months after the counterparty is identified as O-SII

– an institution shall not incur an exposure to a shadow bank entity as defined in Article 4 paragraph 1 point 144 a(new) the value of which, after taking into account the effect of the credit risk mitigation in accordance with Articles 399 to 403, exceeds 15 % of its Tier 1 capital.

– an institution shall not incur an exposure to sovereign bonds issued by any single Member State the value of which, after taking into account the effect of the credit risk mitigation in accordance with Articles 399 to 403, exceeds 100 % of its Tier 1 capital.

By way of derogation from the last indent of the preceding paragraph the exposure limit referred to shall be 200% until one year after the date of application of this Regulation and shall decrease by 20% each subsequent year until the end of the fifth year after the date of application of this Regulation.

Or. en

Amendment 693Ashley Foxon behalf of the ECR GroupBernd Lucke, Ramon Tremosa i BalcellsProposal for a regulationArticle 1 – paragraph 1 – point 95 – point aRegulation (EU) No 575/2013Article 395 – paragraph 1 – subparagraph 4 a (new)

Text proposed by the Commission Amendment

By way of derogation from the first subparagraph, an institution shall not incur aggregate exposure to non-investment grade sovereign bonds issued by any single Member State the value of which, after taking into account the effect of the credit risk mitigation in accordance with Articles 399 to 403, exceeds [50 %] of its Tier 1 capital, unless the institution

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applies a marginal risk weight add-on of [1%] to the excess exposure.

Or. en

Amendment 694Burkhard BalzProposal for a regulationArticle 1 – paragraph 1 – point 95 – point aRegulation (EU) No 575/2013Article 395 – paragraph 1 – subparagraph 4 a (new)

Text proposed by the Commission Amendment

By way of derogation from the first subparagraph, an institution shall not incur aggregate exposure to sovereign bonds issued by any single Member State the value of which, after taking into account the effect of the credit risk mitigation in accordance with Articles 399 to 403, exceeds [X]%1a of its Tier 1 capital, reaching the amount of [X]% after a period of [X]1b years.

__________________1a X is to be a percentage that is to be deemed appropriate after consultation of both ESRB and SSM.1b X is to be a number of years that is to be deemed appropriate after consultation of both ESRB and SSM.

Or. en

Amendment 695Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 95 a (new)Regulation (EU) No 575/2013Article 395 a (new)

Text proposed by the Commission Amendment

(95a) The following Article 395a is inserted:

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"Article 395a

Aggregate limit on exposures to shadow banking entities

An institution shall not incur a total exposure to shadow banking entities the value of which, after taking into account the effect of the credit risk mitigation in accordance with Articles 399 to 403, exceeds 25% of its Tier 1 capital. Competent authorities may set a lower limit than 25% of Tier 1 capital and shall inform EBA and the Commission thereof."

Or. en

Amendment 696Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 98 – point aRegulation (EU) No 575/2013Article 399 – paragraph 1 – subparagraph 1

Text proposed by the Commission Amendment

An institution shall use a credit risk mitigation technique in the calculation of an exposure where it has used this technique to calculate capital requirements for credit risk in accordance with Part Three, Title II and provided it meets the conditions set out in this Article.

An institution may use a credit risk mitigation technique in the calculation of an exposure where it has used this technique to calculate capital requirements for credit risk in accordance with Part Three, Title II and provided it meets the conditions set out in this Article.

Or. en

Justification

This amendment aims at removing the obligation introduced by the Commission to use the substitution approach in the large exposure regime. It can have detrimental effects on real estate market in some countries due to national specificities.

Amendment 697Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 98 – point a a (new)

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Regulation (EU) No 575/2013Article 399 – paragraph 1 a (new)

Text proposed by the Commission Amendment

(aa) The following paragraph 1a is inserted:

"1a. By way of derogation from paragraph 1, institutions that used a credit risk mitigation technique to calculate capital requirements for credit risk in accordance with Part Three, Title II may not use this technique for the purpose of article 395(1) to exposures in the form of a collateral or a guarantee provided by an official export credit agency or by an eligible protection provider referred to in Article 201 qualifying for the credit quality step 2 or above, for officially supported export credits and residential loans."

Or. en

Justification

In specific markets, such as the residential or export credit loans, the market structure is characterised by a very limited number of protection credit providers. In these specific cases, if the large exposure limits is applied, combined with a mandatory substitution approach, as set out in article 403, this might very easily lead to a breach of large exposure limits. A specific exemption for officially supported export credits and residential loans would allow banks to use CRM for fully guaranteed loans and the guaranteed portion of export credit exposures for the purpose of credit risk but would grant them a discretion for not using CRM for the purpose of large exposures. As a consequence, if banks apply this discretion, substitution would no longer be required under art. 401(4). This approach seems more prudentially sound as banks would not benefit from the CRM for the computation of their large exposure limits.

Amendment 698Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 99 – point a – point ii a (new)Regulation (EU) No 575/2013Article 400 – paragraph 1 – point k a (new)

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Text proposed by the Commission Amendment

(ka) exposures, including participations or other kinds of holdings, incurred by an institution to its parent undertaking, to other subsidiaries of that parent undertaking or to its own subsidiaries, in so far as those undertakings are covered by the supervision on a consolidated basis to which the institution itself is subject, in accordance with this Regulation, Directive 2002/87/EC or with equivalent standards in force in a third country; exposures that do not meet these criteria, whether or not exempted from Article 395(1), shall be treated as exposures to a third party.

Or. en

Justification

Change required to remove the conflicting powers afforded to Member States and Competent Authorities, as well as to enhance the ability of the SSM to exercise its powers as the common supervisory authority of the Banking Union.

Amendment 699Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 99 – point a – point ii a (new)Regulation (EU) No 575/2013Article 400 – paragraph 1 – point l a (new)

Text proposed by the Commission Amendment

(la) exposures, including participations or other kinds of holdings, incurred by an institution to its parent undertaking, to other subsidiaries of that parent undertaking or to its own subsidiaries, in so far as those undertakings are covered by the supervision on a consolidated basis to which the institution itself is subject, in accordance with this Regulation, Directive 2002/87/EC or with equivalent standards in force in a third country;

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exposures that do not meet these criteria, whether or not exempted from Article 395(1), shall be treated as exposures to a third party.

Or. en

Justification

This amendment aims at making clear that intragroup exposure are excluded. To recall, the Basel framework doesn't specifically consider the treatment of intragroup exposures.

Amendment 700Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 100Regulation (EU) No 575/2013Article 401 – paragraph 2

Text proposed by the Commission Amendment

2. For the purposes of the first paragraph, institutions shall use the Financial Collateral Comprehensive Method, regardless of the method used for calculating own funds requirements of credit risk.

deleted

Or. en

Justification

Institutions should be allowed to use own estimates of the effects of financial collateral in relation to Securities Financing Transactions, to stay consistent with the treatment allowed in credit risk.

Amendment 701Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 100Regulation (EU) No 575/2013Article 401 – paragraph 2

Text proposed by the Commission Amendment

2. For the purposes of the first 2. With the exception of institutions

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paragraph, institutions shall use the Financial Collateral Comprehensive Method, regardless of the method used for calculating own funds requirements of credit risk.

using the Financial Collateral Simple Method, for the purposes of the first paragraph, institutions shall use the Financial Collateral Comprehensive Method, regardless of the method used for calculating own funds requirements of credit risk.

By derogation from paragraph 1 and the first subparagraph of this paragraph, institutions with a permission to use the method referred to in Part Three, Title II, Chapter 6, Section 6, may continue to use this method for calculating the exposure value of securities financing transactions.

Or. en

Justification

This amendment shall clarify, in line with the Basel standard for measuring LE (para 34), a derogation from the requirements to use the FCCM for calculating exposure value of securities financing transactions for the purpose of LE. Institutions that have a permission to use the IMM under CRR Article 283 may continue using this method.

Amendment 702Thomas MannProposal for a regulationArticle 1 – paragraph 1 – point 100Regulation (EU) No 575/2013Article 401 – paragraph 4

Text proposed by the Commission Amendment

4. Where an institution reduces an exposure to a client due to an eligible credit risk mitigation technique in accordance with Article 399(1), it shall treat the part of the exposure by which the exposure to the client has been reduced as having been incurred to the protection provider rather than to the client.

deleted

Or. de

Amendment 703Markus Ferber

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Proposal for a regulationArticle 1 – paragraph 1 – point 100Regulation (EU) No 575/2013Article 401 – paragraph 4

Text proposed by the Commission Amendment

4. Where an institution reduces an exposure to a client due to an eligible credit risk mitigation technique in accordance with Article 399(1), it shall treat the part of the exposure by which the exposure to the client has been reduced as having been incurred to the protection provider rather than to the client.

deleted

Or. de

Justification

An obligatory substitution would make it difficult to monitor large-scale lending limits.

Amendment 704Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 100Regulation (EU) No 575/2013Article 401 – paragraph 4

Text proposed by the Commission Amendment

4. Where an institution reduces an exposure to a client due to an eligible credit risk mitigation technique in accordance with Article 399(1), it shall treat the part of the exposure by which the exposure to the client has been reduced as having been incurred to the protection provider rather than to the client..

4. Where an institution reduces an exposure to a client due to an eligible credit risk mitigation technique in accordance with Article 399(1), it shall, in the manner set out in Article 403, treat the part of the exposure by which the exposure to the client has been reduced as having been incurred to the protection provider rather than to the client.

Or. en

Justification

Since there may be ambiguity on the interpretation of the text proposed by the Commission, this amendment shall clarify, that the requirement of mandatory substitution is contained in

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CRR Article 401(4) and that CRR Article 403 merely explains how the mandatory substitution shall be applied.

Amendment 705Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 101Regulation (EU) No 575/2013Article 403 – subparagraph 1

Text proposed by the Commission Amendment

Where an exposure to a client is guaranteed by a third party or secured by collateral issued by a third party, an institution shall:.

Where an exposure to a client is guaranteed by a third party or secured by collateral issued by a third party, and where that credit risk mitigation is used to calculate capital requirements for credit risk in accordance with Part Three, Title II, an institution shall:

Or. en

Justification

This amendment shall clarify the text proposed by the Commission to ensure, in line with the Basel standard, that risk substitution should only be mandatory where credit risk mitigation has been recognised to calculate capital requirements for credit risk in accordance with Part Three, Title II.

Amendment 706Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 101Regulation (EU) No 575/2013Article 403 – subparagraph 1

Text proposed by the Commission Amendment

Where an exposure to a client is guaranteed by a third party or secured by collateral issued by a third party, an institution shall:.

Where an exposure to a client is guaranteed by a third party or secured by collateral issued by a third party, with the exception of exposures referred to in article 399(1a), an institution shall:

Or. en

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Justification

In specific markets, such as the residential or export credit loans, the market structure is characterised by a very limited number of protection credit providers. In these specific cases, if the large exposure limits is applied, combined with a mandatory substitution approach, as set out in article 403, this might very easily lead to a breach of large exposure limits. A specific exemption for officially supported export credits and residential loans would allow banks to use CRM for fully guaranteed loans and the guaranteed portion of export credit exposures for the purpose of credit risk but would grant them a discretion for not using CRM for the purpose of large exposures. As a consequence, if banks apply this discretion, substitution would no longer be required under art. 401(4). This approach seems more prudentially sound as banks would not benefit from the CRM for the computation of their large exposure limits.

Amendment 707Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 101Regulation (EU) No 575/2013Article 403 – subparagraph 1

Text proposed by the Commission Amendment

Where an exposure to a client is guaranteed by a third party or secured by collateral issued by a third party, an institution shall:.

Where an exposure to a client is guaranteed by a third party or secured by collateral issued by a third party, an institution may:

Or. en

Justification

This amendment as well aims at removing the obligation introduced by the Commission to use the substitution approach in the large exposure regime. It can have detrimental effects on real estate market in some countries due to national specificities.

Amendment 708Herbert DorfmannProposal for a regulationArticle 1 – paragraph 1 – point 103Regulation (EU) No 575/2013Article 411 – point 2

Text proposed by the Commission Amendment

(2) 'retail deposits' means a liability to a natural person or to a small or medium-sized enterprise ('SME'), where the SME

(2) 'retail deposits' means a liability to a natural person or to a small or medium-sized enterprise ('SME'), where the SME

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would qualify for the retail exposure class under the standardised or IRB approaches for credit risk, or a liability to a company which is eligible for the treatment set out in Article 153(4), and where the aggregate deposits by that SME or company on the basis of a group of connected clients as defined in point (39) of Article 4(1) do not exceed EUR 1 million;

would qualify for the retail exposure class under the standardised or IRB approaches for credit risk, or a liability to a company which is eligible for the treatment set out in Article 153(4), and where the aggregate deposits by that SME or company on the basis of a group of connected clients as defined in point (39) of Article 4(1) do not exceed EUR 1 million; retail deposits’ include notes, bonds and other debt securities issued by the credit institution, when at least one of the following situation apply to those bank’s liabilities:

(a) liability is sold exclusively in the retail market and held in a retail account;

(b) liability is held in a dossier linked to a retail account of the issuer institution and it is possible to monitor the effective holder of the instrument.

Or. en

Amendment 709Jeppe Kofod, Bendt BendtsenProposal for a regulationArticle 1 – paragraph 1 – point 103Regulation (EU) No 575/2013Article 411 – point 6 – introductory part

Text proposed by the Commission Amendment

(6) 'non-mandatory over-collateralisation' means any amount of assets which the institution is not obliged to attach to a covered bond issuance by virtue of legal or regulatory requirements, contractual commitments or for reasons of market discipline, including in particular where:

(6) 'non-mandatory over-collateralisation' means any amount of assets which the institution is not obliged to attach to a covered bond issuance by virtue of legal or regulatory requirements, contractual commitments, including in particular where:

Or. en

Amendment 710Rina Ronja KariProposal for a regulationArticle 1 – paragraph 1 – point 103

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EN

Regulation (EU) No 575/2013Article 411 – point 6 – point b

Text proposed by the Commission Amendment

(b) pursuant to the methodology of a nominated ECAI, the assets are not required for the covered bonds to maintain their current credit assessment;

deleted

Or. en

Justification

It is not a sound principle to base the legislation on credit rating agencies.

Amendment 711Jonás FernándezProposal for a regulationArticle 1 – paragraph 1 – point 103Regulation (EU) No 575/2013Article 411 – point 6 – point b

Text proposed by the Commission Amendment

(b) pursuant to the methodology of a nominated ECAI, the assets are not required for the covered bonds to maintain their current credit assessment;

deleted

Or. en

Amendment 712Jeppe Kofod, Bendt BendtsenProposal for a regulationArticle 1 – paragraph 1 – point 103Regulation (EU) No 575/2013Article 411 – point 6 – point b

Text proposed by the Commission Amendment

(b) pursuant to the methodology of a nominated ECAI, the assets are not required for the covered bonds to maintain their current credit assessment;

deleted

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Or. en

Amendment 713Jonás FernándezProposal for a regulationArticle 1 – paragraph 1 – point 103Regulation (EU) No 575/2013Article 411 – point 6 – point c

Text proposed by the Commission Amendment

(c) the assets are not required for material credit enhancement purposes;

deleted

Or. en

Amendment 714Rina Ronja KariProposal for a regulationArticle 1 – paragraph 1 – point 103Regulation (EU) No 575/2013Article 411 – point 6 – point c

Text proposed by the Commission Amendment

(c) the assets are not required for material credit enhancement purposes;

deleted

Or. en

Amendment 715Jeppe Kofod, Bendt BendtsenProposal for a regulationArticle 1 – paragraph 1 – point 103Regulation (EU) No 575/2013Article 411 – point 6 – point c

Text proposed by the Commission Amendment

(c) the assets are not required for material credit enhancement purposes;

deleted

Or. en

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Amendment 716Pervenche BerèsProposal for a regulationArticle 1 – paragraph 1 – point 103Regulation (EU) No 575/2013Article 411 – point 15 a (new)

Text proposed by the Commission Amendment

(15a) "Factoring", which is to be treated as trade finance in part VI of this Regulation, means an agreement between a business (Assignor) and a financial entity (Factor) in which the Assignor assigns/sells its receivables to the Factor and the Factor provides the Assignor with a combination of one or more of the following services with regard to the receivables assigned: advance of a percentage of the amount of receivables assigned, management of receivables, collection and credit protection.

Or. en

Amendment 717Anne Sander, Alain Lamassoure, Alain CadecProposal for a regulationArticle 1 – paragraph 1 – point 103Regulation (EU) No 575/2013Article 411 – point 15 a (new)

Text proposed by the Commission Amendment

(15a) In part VI of this regulation, factoring will be treated as trade finance. “Factoring” means an agreement between a business (Assignor) and a financial entity (Factor) in which the Assignor assigns/sells its Receivables to the Factor and the Factor provides the Assignor with a combination of one or more of the following services with regard to the Receivables assigned: Advance of a percentage of the amount of Receivables assigned, that is generally short term, uncommitted and without automatic roll-over, Receivables management, collection

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and Credit protection. Usually, the Factor administers the Assignor’s sales ledger and collects the Receivables in its own name. The Assignment can be disclosed to the Debtor.

Or. en

Justification

Factoring is a short term and uncommitted financing, with a low funding risk profile . Trade Finance is characterized by the same criteria, and as such benefit from a specific and preferential treatment, notably for Liquidity requirements, which is not explicitly the case of Factoring. Like Trade Finance, factoring is a major instrument for the financing of European corporates.

Amendment 718Thierry Cornillet, Caroline NagtegaalProposal for a regulationArticle 1 – paragraph 1 – point 103Regulation No 575/2013/EUArticle 411 – point 15 a (new)

Text proposed by the Commission Amendment

(15a) "Factoring" means a contractual agreement between a business (assignor) and a financial entity (factor) in which the assignor assigns or sells its receivables to the factor in exchange of providing the assignor with one or more of the following services with regard to the receivables assigned:

– advance of a percentage of the amount of receivables assigned generally short term, uncommitted and without automatic roll-over,

– receivables management, collection and credit protection generally the factor administering the assignor’ sales ledger and collecting the receivables in its own name.

Or. en

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Justification

Factoring is a short term and uncommitted financing, with a low funding risk profile. Trade Finance is characterized by the same criteria, and as such benefit from a specific and preferential treatment, notably for Liquidity requirements, which is not explicitly the case of Factoring. Like Trade Finance, factoring is a major instrument for the financing of European corporates.

Amendment 719Thierry Cornillet, Caroline NagtegaalProposal for a regulationArticle 1 – paragraph 1 – point 103Regulation No 575/2013/EUArticle 411 – subparagraph 1 a (new)

Text proposed by the Commission Amendment

For the purposes of this Part, factoring shall be treated as trade finance.

Or. en

Justification

Factoring is a short term and uncommitted financing, with a low funding risk profile. Trade Finance is characterized by the same criteria, and as such benefit from a specific and preferential treatment, notably for Liquidity requirements, which is not explicitly the case of Factoring. Like Trade Finance, factoring is a major instrument for the financing of European corporates.

Amendment 720Marco ValliProposal for a regulationArticle 1 – paragraph 1 – point 104 – point -a (new)Regulation No 575/2013/EUArticle 412 – paragraph 1 a (new)

Text proposed by the Commission Amendment

(-a) the following new paragraph 1a is inserted:

"1a. Institutions shall hold an additional amount of high quality liquid assets (HQLA) Level 1 to account for the risks arising from their exposure in illiquid assets. The stock of HQLA should

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be increased by the following percentages:

(i) 0%, where the total value of the derivative positions of the institution is less or equal to 8% of its total on- and off-balance sheet assets;

(ii) 7%, where the total value of the derivative positions of the institution is above 8 % but less or equal to 15% of its total on- and off-balance sheet assets;

(iii) 9% where the total value of the derivative positions of the institution is above 15 % but less or equal to 25% of its total on- and off-balance sheet assets;

(iv) 12%, where the total value of the derivative positions of the institution is above 25% of its total on- and off-balance sheet assets."

Or. en

Justification

Institutions exposed to additional liquidity risk should hold a higher buffer of high quality liquid assets, in order to withstand severe stress. Therefore, the liquidity coverage ratio should be increased, depending on the size of the institution's exposure to derivatives.

Amendment 721Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 104 – point c a (new)Regulation (EU) No 575/2013Article 412 – paragraph 5

Present text Amendment

(ca) In Article 412, paragraph 5 shall be replaced by the following:

"5. Member States may maintain or introduce national provisions in the area of liquidity requirements before binding minimum standards for liquidity coverage requirements are specified and fully introduced in the Union in accordance with Article 460. Member States or competent authorities may require

"As from [two years after the entry into force of the CRR Amending Regulation] Member States shall phase out national provisions in the area of liquidity requirements."

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domestically authorised institutions, or a subset of those institutions, to maintain a higher liquidity coverage requirement up to 100 % until the binding minimum standard is fully introduced at a rate of 100 % in accordance with Article 460."

Or. en

(http://eur-lex.europa.eu/legal-content/en/TXT/?uri=celex%3A32013R0575)

Amendment 722Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 105Regulation (EU) No 575/2013Article 413 – paragraph 4

Text proposed by the Commission Amendment

4. Member States may maintain or introduce national provisions in the area of stable funding requirements before binding minimum standards for the net stable funding requirements set out in paragraph 1 become applicable..

4. As from [two years after the entry into force of the CRR Amending Regulation] Member States shall phase out national provisions in the area of stable funding requirements.

Or. en

Amendment 723Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 106Regulation (EU) No 575/2013Article 414

Text proposed by the Commission Amendment

An institution that does not meet, or expects not to meet, the requirements set out in Article 412 or in Article 413(1), including during times of stress, shall immediately notify the competent authorities thereof and shall submit without undue delay to the competent authorities a plan for the timely restoration of compliance with the requirements set out

An institution that does not meet, or expects not to meet, the requirements set out in Article 412 or in Article 413(1), including during times of stress, shall immediately notify the competent authorities thereof and shall submit without undue delay to the competent authorities a plan for the timely restoration of compliance with the requirements set out

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in Article 412 or Article 413(1), as appropriate. Until compliance has been restored, the institution shall report the items referred to in Title II, III or IV, as appropriate, daily by the end of each day unless the competent authority authorises a lower reporting frequency and a longer reporting delay. Competent authorities shall only grant those authorisations based on the individual situation of an institution and taking into account the scale and complexity of the institution's activities. Competent authorities shall monitor the implementation of the restoration plan and shall require a more speedy restoration if appropriate..

in Article 412 or Article 413(1), as appropriate. Until compliance has been restored, the institution shall report the items referred to in Title II, III or IV, as appropriate, daily by the end of each day unless the competent authority authorises a lower reporting frequency and a longer reporting delay. Competent authorities shall only grant those authorisations based on the individual situation of an institution and taking into account the scale and complexity of the institution's activities. Competent authorities shall monitor the implementation of the restoration plan and shall require a more speedy restoration if appropriate. Small and non-complex institutions within the meaning of Article 430a which have complied with at least 150 % of the liquidity coverage requirement within the meaning of Article 412 for the last six reporting dates shall be permitted, as from the subsequent reporting date, to carry out the continuous monitoring of their liquidity coverage requirement only on the reporting date in accordance with the technical implementation standards of Article 415. This provision applies as long as the liquidity coverage requirement of the institution does not fall below 150 % on two additional successive reporting dates.

Or. en

Amendment 724Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 107Regulation (EU) No 575/2013Article 415 – paragraph 3 – subparagraph 3

Text proposed by the Commission Amendment

Until the full introduction of binding liquidity requirements, competent authorities may continue to collect information through monitoring tools for the purpose of monitoring compliance with

As from [two years after the entry into force of the CRR Amending Regulation] competent authorities shall cease to collect information through monitoring tools for the purpose of monitoring compliance with

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existing national liquidity standards. existing national liquidity standards.

Or. en

Amendment 725Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 107Regulation (EU) No 575/2013Article 415 – paragraph 3 – subparagraphs 4 a and 4 b (new)

Text proposed by the Commission Amendment

Power is conferred on the Commission to adopt the implementing technical standards referred to in the first subparagraph in accordance with Article 15 of Regulation (EU) No 1093/2010..

Power is conferred on the Commission to adopt the implementing technical standards referred to in the first subparagraph in accordance with Article 15 of Regulation (EU) No 1093/2010.

The Commission Implementing Regulation (EU) 2016/313 of 1 March 2016 with regard to additional monitoring metrics for liquidity reporting shall not apply to small institutions as defined in Article 430a if their refinancing is based on deposits with a high degree of granularity and if their assets are sufficiently diversified.

The EBA shall issue regulatory technical standards to define “deposits with a high degree of granularity” and “sufficiently diversified assets” as condition for the exemption of small institutions from additional monitoring metrics for liquidity reporting.

Or. en

Amendment 726Wolf KlinzProposal for a regulationArticle 1 – paragraph 1 – point 108 – point bRegulation (EU) No 575/2013Article 416 – paragraph 5 – subparagraph 1

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Text proposed by the Commission Amendment

Shares or units in CIUs may be treated as liquid assets up to an absolute amount of EUR 500 million in the portfolio of liquid assets of each institution provided that the requirements in Article 132(3) are met and that the CIU, apart from derivatives to mitigate interest rate or credit or currency risk, only invests in liquid assets as referred to in paragraph 1 of this Article.

Shares or units in CIUs may be treated as liquid assets up to an absolute amount of EUR 500 million in the portfolio of liquid assets of each institution provided that the requirements in Article 132(3) are met and that more than 75% of the CIU's investments, apart from derivatives to mitigate interest rate or credit or currency risk, are in liquid assets as referred to in paragraph 1 of this Article.

Or. en

Amendment 727Werner LangenProposal for a regulationArticle 1 – paragraph 1 – point 108 – point bRegulation (EU) No 575/2013Article 416 – paragraph 5 – subparagraph 1

Text proposed by the Commission Amendment

Shares or units in CIUs may be treated as liquid assets up to an absolute amount of EUR 500 million in the portfolio of liquid assets of each institution provided that the requirements in Article 132(3) are met and that the CIU, apart from derivatives to mitigate interest rate or credit or currency risk, only invests in liquid assets as referred to in paragraph 1 of this Article.

Shares or units in CIUs may be treated as liquid assets up to a total amount of EUR 500 million in the portfolio of liquid assets of each institution provided that the requirements in Article 132(3) are met and that the CIU, apart from derivatives to mitigate interest rate or credit or currency risk, only invests in liquid assets as referred to in paragraph 1 of this Article.

Or. de

Justification

The above Regulation in its current form discriminates against small banks trying to guarantee regulatory LCR crediting (by means of liquid assets) and current income (by means of other assets) via one and the same investment fund. Since Article 418(3a) ensures that only those assets can be recognised which have been identified as such, the so-called ‘look-through principle’ already offers a more gentle approach which justifies deleting the word ‘only’ in Article 416(6).

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Amendment 728Thomas Mann, Werner LangenProposal for a regulationArticle 1 – paragraph 1 – point 108 – point bRegulation (EU) No 575/2013Article 416 – paragraph 5 – subparagraph 1

Text proposed by the Commission Amendment

Shares or units in CIUs may be treated as liquid assets up to an absolute amount of EUR 500 million in the portfolio of liquid assets of each institution provided that the requirements in Article 132(3) are met and that the CIU, apart from derivatives to mitigate interest rate or credit or currency risk, only invests in liquid assets as referred to in paragraph 1 of this Article.

Shares or units in CIUs may be treated as liquid assets up to a total amount of EUR 500 million in the portfolio of liquid assets of each institution provided that the requirements in Article 132(3) are met and that the CIU, apart from derivatives to mitigate interest rate or credit or currency risk, invests in liquid assets as referred to in paragraph 1 of this Article.

Or. de

Amendment 729Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 108 – point bRegulation (EU) No 575/2013Article 416 – paragraph 5 – subparagraph 1

Text proposed by the Commission Amendment

Shares or units in CIUs may be treated as liquid assets up to an absolute amount of EUR 500 million in the portfolio of liquid assets of each institution provided that the requirements in Article 132(3) are met and that the CIU, apart from derivatives to mitigate interest rate or credit or currency risk, only invests in liquid assets as referred to in paragraph 1 of this Article.

Shares or units in CIUs may be treated as liquid assets up to an absolute amount of EUR 500 million in the portfolio of liquid assets of each institution provided that the requirements in Article 132(3) are met and that the CIU, apart from derivatives to mitigate interest rate or credit or currency risk, invests in liquid assets as referred to in paragraph 1 of this Article.

Or. en

Justification

Since Art. 418(3)(a) ensures that only those assets can be recognized under the LCR which have been identified as liquid assets by means of a look-through-approach, the Commission proposal on Art. 416(5) can be considered unproportionate for smaller institutions which

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would have to achieve a return and regulatory recognition by one and the same CIU. In this context, the deletion of the word “only” aims to avoid a regulatory disincentive to contribute to a risk diversification by means of a CIU.

Amendment 730Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 108 – point bRegulation (EU) No 575/2013Article 416 – paragraph 5 – subparagraph 1

Text proposed by the Commission Amendment

Shares or units in CIUs may be treated as liquid assets up to an absolute amount of EUR 500 million in the portfolio of liquid assets of each institution provided that the requirements in Article 132(3) are met and that the CIU, apart from derivatives to mitigate interest rate or credit or currency risk, only invests in liquid assets as referred to in paragraph 1 of this Article.

Shares or units in CIUs may be treated as liquid assets up to an absolute amount of EUR 500 million in the portfolio of liquid assets of each institution provided that the requirements in Article 132(3) are met and that the CIU, apart from derivatives to mitigate interest rate or credit or currency risk, invests in liquid assets as referred to in paragraph 1 of this Article.

Or. en

Amendment 731Matt Carthy, Martin SchirdewanProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 b – paragraph 2

Text proposed by the Commission Amendment

2. Institutions shall maintain a net stable funding ratio of at least 100%.

2. Institutions other than G-SIIs shall maintain a net stable funding ratio of at least 100%.

Or. en

Amendment 732Matt Carthy, Martin SchirdewanProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 b – paragraph 2 a (new)

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Text proposed by the Commission Amendment

2a. G-SIIs shall maintain a net stable funding ratio of at least 120%.

Or. en

Amendment 733Matt Carthy, Martin SchirdewanProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 b – paragraph 3

Text proposed by the Commission Amendment

3. Where at any time the net stable funding ratio of an institution has fallen or can be reasonably expected to fall below 100%, the requirement laid down in Article 414 shall apply. The institution shall aim at restoring its net stable funding ratio to the level referred to in paragraph 2. Competent authorities shall assess the reasons for non-compliance with the level referred to in paragraph 2 before taking, where appropriate, any supervisory measures.

3. Where at any time the net stable funding ratio of an institution has fallen or can be reasonably expected to fall below the thresholds specified in paragraph 2 and 2a (new) of this Article, the requirement laid down in Article 414 shall apply. The institution shall aim at restoring its net stable funding ratio to the levels referred to in paragraph 2 and 2a (new). Competent authorities shall assess the reasons for non-compliance with the level referred to in paragraph 2 and 2a (new) before taking, where appropriate, any supervisory measures.

Or. en

Amendment 734Markus FerberProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 c – paragraph 3a (new)

Text proposed by the Commission Amendment

3a. Institutions providing services concerned with the resolution of precious-metal transactions do not take into account precious-metal exposures which

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result from these services when calculating the Net Stable Funding Ratio.

Or. de

Justification

Precious-metal positions which are offered in order to provide settlement services should not be brought into play in the calculation of the Net Stable Funding Ratio.

Amendment 735Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 d – paragraph 2

Text proposed by the Commission Amendment

2. By way of derogation from Article 428c(1), institutions shall take into account the accounting value of derivative positions on a net basis where those positions are included in the same netting set that fulfils the requirements set out in Articles 295, 296 and 297. Where that is not the case, institutions shall take into account the accounting value of derivative positions on a gross basis and they shall treat those derivatives positions as their own netting set for the purpose of Chapter 4 of this Title.

2. By way of derogation from Article 428c(1), institutions shall take into account the market value of derivative positions on a net basis where those positions are included in the same netting set that fulfils the requirements set out in Articles 295, 296 and 297. Where that is not the case, institutions shall take into account the market value of derivative positions on a gross basis and they shall treat those derivatives positions as their own netting set for the purpose of Chapter 4 of this Title.

Or. en

Justification

This amendment shall clarify an inconsistency between paragraph 2 and paragraph 3 of CRR Article 428d, which may be misleading since in paragraph 3 reference is made to the market value of a netting set, and thus allow for an consistent treatment across banks in the Union.

Amendment 736Peter SimonProposal for a regulationArticle 1 – paragraph 1 – point 114

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Regulation (EU) No 575/2013Article 428 d – paragraph 2

Text proposed by the Commission Amendment

2. By way of derogation from Article 428c(1), institutions shall take into account the accounting value of derivative positions on a net basis where those positions are included in the same netting set that fulfils the requirements set out in Articles 295, 296 and 297. Where that is not the case, institutions shall take into account the accounting value of derivative positions on a gross basis and they shall treat those derivatives positions as their own netting set for the purpose of Chapter 4 of this Title.

2. By way of derogation from Article 428c(1), institutions shall take into account the market value of derivative positions on a net basis where those positions are included in the same netting set that fulfils the requirements set out in Articles 295, 296 and 297. Where that is not the case, institutions shall take into account the market value of derivative positions on a gross basis and they shall treat those derivatives positions as their own netting set for the purpose of Chapter 4 of this Title.

Or. en

Justification

(See the ECB's opinion (CON/2017/46)). There is an inconsistency between paragraph 2 and paragraph 3 of Article 428d, since in paragraph 3 reference is made to the market value of a netting set. It may therefore be misleading to refer to the accounting value in paragraph 2 as this may result in inconsistent treatment across banks. Reference should thus be made to the market value to ensure that the treatment of derivatives in the NSFR is independent from the relevant accounting scheme.

Amendment 737Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 d – paragraph 4

Text proposed by the Commission Amendment

4. All derivative contracts referred to in points (a) to (e) of paragraph 2 of Annex II that involve a full exchange of principal amounts on the same date shall be calculated on a net basis across currencies, including for the purpose of reporting in a currency that is subject to a separate reporting in accordance with Article

4. All derivative contracts referred to in points (a) to (e) of paragraph 2 of Annex II that involve a full exchange of principal amounts on the same date shall be calculated on a net basis across currencies, even where those transactions are not included in the same netting set that fulfils the requirements set out in Articles 295,

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415(2), even where those transactions are not included in the same netting set that fulfils the requirements set out in Articles 295, 296 and 297.

296 and 297.

Or. en

Amendment 738Pervenche BerèsProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 e

Text proposed by the Commission Amendment

By way of derogation from Article 428c(1), assets and liabilities resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with a single counterparty shall be calculated on a net basis, provided that those assets and liabilities respect the netting conditions set out in Article 429b(4).

In the application of point (b) of Article 428s and point (a) of Article 428u(1) and by way of derogation from Article 428c(1), assets and liabilities resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) shall be calculated on a net basis, provided that the transactions explicit final settlement dates are below six months.

Or. en

Amendment 739Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 f – paragraph 1 – introductory part

Text proposed by the Commission Amendment

1. Subject to prior approval of competent authorities, an institution may consider that an asset and a liability are interdependent, provided that all of the following conditions are fulfilled:

1. If competent authorities agree through a prior approval process, an institution may consider that an asset and a liability are interdependent, provided that all of the following conditions are fulfilled:

Or. en

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Justification

This amendment shall ensure that the prior approval process for interdependent assets and liabilities shall remain in the sole discretion of the competent authorities.

Amendment 740Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 f – paragraph 2 – introductory part

Text proposed by the Commission Amendment

2. Assets and liabilities directly linked to the following products or services shall be considered to meet the conditions of paragraph 1 and be considered as interdependent :

2. Assets and liabilities directly linked to the following products or services shall be considered to meet the conditions of paragraph 1 and be considered at both the individual and consolidated levels :

Or. en

Amendment 741Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 f – paragraph 2 – point c

Text proposed by the Commission Amendment

(c) covered bonds as referred to in Article 52(4) of Directive 2009/65/EC;

(c) covered bonds as referred to in Article 52(4) of Directive 2009/65/EC and covered bonds that meet the eligibility requirements for the treatment set out in Article 129(4) or (5), as appropriate, where the underlying loans are fully matched funded with the covered bonds issued or where there exists non-discretionary extendable maturity triggers on the covered bonds of one year or more until the term of the underlying loans in the event of refinancing failure at the maturity date of the covered bond, or where national legislation adequately limits refinancing risk for covered bond issuers including through limitations on

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maturity mismatch between assets and liabilities;

Or. en

Justification

This amendment aims at recognizing covered bonds as interdependent assets and liabilities for the NSFR. The modification aims at ensuring that the NSFR is not over penalizing covered bonds

Amendment 742Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 f – paragraph 2 – point c

Text proposed by the Commission Amendment

(c) covered bonds as referred to in Article 52(4) of Directive 2009/65/EC;

(c) covered bonds as referred to in Article 52(4) of Directive 2009/65/EC; or that meet the eligibility requirements for the treatment set out in Article 129(4) or (5), and (7) of the Regulation (EU) No 575/2013;

Or. en

Amendment 743Pervenche BerèsProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 f – paragraph 2 – point d

Text proposed by the Commission Amendment

(d) covered bonds that meet the eligibility requirements for the treatment set out in Article 129(4) or (5), as appropriate, where the underlying loans are fully matched funded with the covered bonds issued or where there exists non-discretionary extendable maturity triggers on the covered bonds of one year or more

(d) covered bonds that meet the eligibility requirements for the treatment set out in Article 129(4) or (5), as appropriate, where the underlying loans are fully matched funded with the covered bonds issued or where there exists non-discretionary extendable maturity triggers on the covered bonds of one year or more

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until the term of the underlying loans in the event of refinancing failure at the maturity date of the covered bond ;

until the term of the underlying loans in the event of refinancing failure at the maturity date of the covered bond, or where national legislation adequately limits refinancing risk for covered bond issuers, including through limitations on maturity mismatch between assets and liabilities;

Or. en

Amendment 744Stanisław OżógProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 f – paragraph 2 – point d

Text proposed by the Commission Amendment

(d) covered bonds that meet the eligibility requirements for the treatment set out in Article 129(4) or (5), as appropriate, where the underlying loans are fully matched funded with the covered bonds issued or where there exists non-discretionary extendable maturity triggers on the covered bonds of one year or more until the term of the underlying loans in the event of refinancing failure at the maturity date of the covered bond ;

(d) covered bonds that meet the eligibility requirements for the treatment set out in Article 129(4) or (5), as appropriate, where the underlying loans are fully matched funded with the covered bonds issued or where there exists contractual or legal provisions to manage refinancing risk.

Or. en

Justification

In our opinion, the COM approach is inconsistent, since it treats covered bonds preferentially in case of LCR (which targets short-term liquidity shocks), but does not provide the same in case of the NSFR, which are long-term liquidity ratio. Therefore, we see a strong need to adequately adjust current approach to better calibrate NSFR to EU market specificities and ensure level playing field across Members States with different covered bonds frameworks. Possible solution is to extend the scope of interdependent assets and liabilities by revising Article 428f (2)(d) of the CRR as above

Amendment 745Dariusz Rosati

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Proposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 f – paragraph 2 – point d

Text proposed by the Commission Amendment

(d) covered bonds that meet the eligibility requirements for the treatment set out in Article 129(4) or (5), as appropriate, where the underlying loans are fully matched funded with the covered bonds issued or where there exists non-discretionary extendable maturity triggers on the covered bonds of one year or more until the term of the underlying loans in the event of refinancing failure at the maturity date of the covered bond ;

(d) covered bonds that meet the eligibility requirements for the treatment set out in Article 129(4) or (5), as appropriate, where the underlying loans are fully matched funded with the covered bonds issued or where there exists contractual or legal provisions to manage refinancing risk;

Or. en

Amendment 746Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 1 – introductory part

Text proposed by the Commission Amendment

1. By way of derogation from Article 428g and from Chapters 3 and 4 of this Title, competent authorities may on a case-by-case basis authorise institutions to apply a higher available stable funding factor or a lower required stable funding factor to assets, liabilities and committed credit or liquidity facilities where all of the following conditions are fulfilled:

1. By way of derogation from Article 428g and from Chapters 3 and 4 of this Title, competent authorities shall authorise institutions to apply a higher available stable funding factor or a lower required stable funding factor to assets, liabilities and both granted or received committed credit or liquidity facilities where all of the following conditions are fulfilled:

Or. en

Justification

The Commission's wording creates additional funding needs at solo level, which do not exist at group level. The preferential intragroup treatment must be granted, not subject to competent authority’s authorization.

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Amendment 747Marco ValliProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 1 – introductory part

Text proposed by the Commission Amendment

1. By way of derogation from Article 428g and from Chapters 3 and 4 of this Title, competent authorities may on a case-by-case basis authorise institutions to apply a higher available stable funding factor or a lower required stable funding factor to assets, liabilities and committed credit or liquidity facilities where all of the following conditions are fulfilled:

1. By way of derogation from Article 428g and from Chapters 3 and 4 of this Title, competent authorities shall authorise institutions to apply a higher available stable funding factor or a lower required stable funding factor to assets, liabilities and committed credit or liquidity facilities where all of the following conditions are fulfilled:

Or. en

Amendment 748Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 1 – introductory part

Text proposed by the Commission Amendment

1. By way of derogation from Article 428g and from Chapters 3 and 4 of this Title, competent authorities may on a case-by-case basis authorise institutions to apply a higher available stable funding factor or a lower required stable funding factor to assets, liabilities and committed credit or liquidity facilities where all of the following conditions are fulfilled:

1. By way of derogation from Article 428g and from Chapters 3 and 4 of this Title, competent authorities shall authorise institutions to apply a higher available stable funding factor or a lower required stable funding factor to assets, liabilities and committed credit or liquidity facilities where all of the following conditions are fulfilled:

Or. en

Justification

Solo level requirements at NSFR level, will be impacted by many asymmetries on RSF/ASF rates on operations between financial counterparts. This asymmetry makes no sense, as it concerns the same lending / borrowing operation, which is considered at the same time, as

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rolled in one scenario, and not in the second. It creates additional funding needs at solo level, which do not exist at group level. We therefore suggest that the preferential intragroup treatment be granted, not subject to competent authority’s authorization.

Amendment 749Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 1 – introductory part

Text proposed by the Commission Amendment

1. By way of derogation from Article 428g and from Chapters 3 and 4 of this Title, competent authorities may on a case-by-case basis authorise institutions to apply a higher available stable funding factor or a lower required stable funding factor to assets, liabilities and committed credit or liquidity facilities where all of the following conditions are fulfilled:

1. By way of derogation from Article 428g and from Chapters 3 and 4 of this Title, competent authorities shall authorise institutions to apply a higher available stable funding factor or a lower required stable funding factor to assets, liabilities and committed credit or liquidity facilities where all of the following conditions are fulfilled:

Or. en

Amendment 750Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 1 – point a – point v a (new)

Text proposed by the Commission Amendment

(va) the counterparty is located within the same Member State or in a different Member State;

Or. en

Amendment 751Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 1 – point a – point v a (new)

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Text proposed by the Commission Amendment

(va) the counterparty is located within the same Member State or in a different Member State;

Or. en

Justification

Solo level requirements at NSFR level, will be impacted by many asymmetries on RSF/ASF rates on operations between financial counterparts. This asymmetry makes no sense, as it concerns the same lending / borrowing operation, which is considered at the same time, as rolled in one scenario, and not in the second. It creates additional funding needs at solo level, which do not exist at group level. We therefore suggest that the preferential intragroup treatment be granted, not subject to competent authority’s authorization.

Amendment 752Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114 (new)Regulation (EU) No 575/2013Article 428 h – paragraph 1 – point a – point v a (new)

Text proposed by the Commission Amendment

(va) the counterparty is located within the same Member State or in a different Member State.

Or. en

Justification

The Commission's wording creates additional funding needs at solo level, which do not exist at group level. The preferential intragroup treatment must be granted, not subject to competent authority’s authorization.

Amendment 753Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 1 – point b

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Text proposed by the Commission Amendment

(b) there are reasons to expect that the liability or committed credit or liquidity facility received constitutes a more stable source of funding or that the asset or committed credit or liquidity facility granted requires less stable funding within the one-year horizon of the net stable funding ratio than the same liability, asset or committed credit or liquidity facility with other counterparties;

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Or. en

Justification

Solo level requirements at NSFR level, will be impacted by many asymmetries on RSF/ASF rates on operations between financial counterparts. This asymmetry makes no sense, as it concerns the same lending / borrowing operation, which is considered at the same time, as rolled in one scenario, and not in the second. It creates additional funding needs at solo level, which do not exist at group level. We therefore suggest that the preferential intragroup treatment be granted, not subject to competent authority’s authorization.

Amendment 754Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 1 – point b

Text proposed by the Commission Amendment

(b) there are reasons to expect that the liability or committed credit or liquidity facility received constitutes a more stable source of funding or that the asset or committed credit or liquidity facility granted requires less stable funding within the one-year horizon of the net stable funding ratio than the same liability, asset or committed credit or liquidity facility with other counterparties;

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Or. en

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Amendment 755Marco ValliProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 1 – point b

Text proposed by the Commission Amendment

(b) there are reasons to expect that the liability or committed credit or liquidity facility received constitutes a more stable source of funding or that the asset or committed credit or liquidity facility granted requires less stable funding within the one-year horizon of the net stable funding ratio than the same liability, asset or committed credit or liquidity facility with other counterparties;

deleted

Or. en

Amendment 756Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 1 – point b

Text proposed by the Commission Amendment

(b) there are reasons to expect that the liability or committed credit or liquidity facility received constitutes a more stable source of funding or that the asset or committed credit or liquidity facility granted requires less stable funding within the one-year horizon of the net stable funding ratio than the same liability, asset or committed credit or liquidity facility with other counterparties;

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Or. en

Justification

The Commission's wording creates additional funding needs at solo level, which do not exist

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at group level. The preferential intragroup treatment must be granted, not subject to competent authority’s authorization.

Amendment 757Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 1 – point d

Text proposed by the Commission Amendment

(d) the institution and the counterparty are established in the same Member State.

deleted

Or. en

Justification

The Commission's wording creates additional funding needs at solo level, which do not exist at group level. The preferential intragroup treatment must be granted, not subject to competent authority’s authorization.

Amendment 758Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 1 – point d

Text proposed by the Commission Amendment

(d) the institution and the counterparty are established in the same Member State.

deleted

Or. en

Justification

Solo level requirements at NSFR level, will be impacted by many asymmetries on RSF/ASF rates on operations between financial counterparts. This asymmetry makes no sense, as it concerns the same lending / borrowing operation, which is considered at the same time, as rolled in one scenario, and not in the second. It creates additional funding needs at solo level, which do not exist at group level. We therefore suggest that the preferential intragroup

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treatment be granted, not subject to competent authority’s authorization.

Amendment 759Marco ValliProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 2

Text proposed by the Commission Amendment

2. Where the institution and the counterparty are established in different Member States, competent authorities may waive the condition set out in point (d) of paragraph 1 where, in addition to the criteria set out in paragraph 1, the following criteria are fulfilled:

deleted

(a) there are legally binding agreements and commitments between group entities regarding the liability, asset or committed credit or liquidity facility;

(b) the funding provider presents a low funding risk profile;

(c) the funding risk profile of the funding receiver has been adequately taken into account in the liquidity risk management of the funding provider.

The competent authorities shall consult each other in accordance with point (b) of Article 20(1) to determine whether the additional criteria set out in this paragraph are met.

Or. en

Amendment 760Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 2

Text proposed by the Commission Amendment

2. Where the institution and the deleted

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counterparty are established in different Member States, competent authorities may waive the condition set out in point (d) of paragraph 1 where, in addition to the criteria set out in paragraph 1, the following criteria are fulfilled:

(a) there are legally binding agreements and commitments between group entities regarding the liability, asset or committed credit or liquidity facility;

(b) the funding provider presents a low funding risk profile;

(c) the funding risk profile of the funding receiver has been adequately taken into account in the liquidity risk management of the funding provider.

The competent authorities shall consult each other in accordance with point (b) of Article 20(1) to determine whether the additional criteria set out in this paragraph are met.

Or. en

Justification

The Commission's wording creates additional funding needs at solo level, which do not exist at group level. The preferential intragroup treatment must be granted, not subject to competent authority’s authorization.

Amendment 761Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 2

Text proposed by the Commission Amendment

2. Where the institution and the counterparty are established in different Member States, competent authorities may waive the condition set out in point (d) of paragraph 1 where, in addition to the criteria set out in paragraph 1, the

deleted

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following criteria are fulfilled:

(a) there are legally binding agreements and commitments between group entities regarding the liability, asset or committed credit or liquidity facility;

(b) the funding provider presents a low funding risk profile;

(c) the funding risk profile of the funding receiver has been adequately taken into account in the liquidity risk management of the funding provider.

The competent authorities shall consult each other in accordance with point (b) of Article 20(1) to determine whether the additional criteria set out in this paragraph are met.

Or. en

Amendment 762Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 h – paragraph 2

Text proposed by the Commission Amendment

2. Where the institution and the counterparty are established in different Member States, competent authorities may waive the condition set out in point (d) of paragraph 1 where, in addition to the criteria set out in paragraph 1, the following criteria are fulfilled:

deleted

(a) there are legally binding agreements and commitments between group entities regarding the liability, asset or committed credit or liquidity facility;

(b) the funding provider presents a low funding risk profile;

(c) the funding risk profile of the funding receiver has been adequately taken into account in the liquidity risk

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management of the funding provider.

The competent authorities shall consult each other in accordance with point (b) of Article 20(1) to determine whether the additional criteria set out in this paragraph are met.

Or. en

Justification

Solo level requirements at NSFR level, will be impacted by many asymmetries on RSF/ASF rates on operations between financial counterparts. This asymmetry makes no sense, as it concerns the same lending / borrowing operation, which is considered at the same time, as rolled in one scenario, and not in the second. It creates additional funding needs at solo level, which do not exist at group level. We therefore suggest that the preferential intragroup treatment be granted, not subject to competent authority’s authorization.

Amendment 763Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 k – paragraph 2 – point c – point iii

Text proposed by the Commission Amendment

(iii) financial customers; deleted

Or. en

Amendment 764Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 k – paragraph 2 – point c a (new)

Text proposed by the Commission Amendment

(ca) liabilities with a residual maturity of less than one year provided by financial customers;

Or. en

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Amendment 765Marco Zanni, Bernard Monot, Gerolf AnnemansProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 l – title

Text proposed by the Commission Amendment

Article 428l Article 428l

50% available stable funding factor 30% available stable funding factor

Or. en

Justification

Considering the Banco Popular case, short term liabilities like deposits from Member States and Public Sector Entities can be very volatile, taking also into account their information power.

Amendment 766Alfred SantProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 l – point c a (new)

Text proposed by the Commission Amendment

(ca) covered bonds as referred to in Article 52(4) of Directive2009/65/EC or covered bonds that meet the eligibility requirements for the treatment set out in Article 129 (4) or (5) and with a residual contractual maturity less than one year.

Or. en

Amendment 767Jeppe KofodProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 p – paragraph 4 – point c

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Text proposed by the Commission Amendment

(c) assets attached as non-mandatory overcollateralisation to a covered bond issuance.

(c) all assets attached as non-mandatory overcollateralization and level 1 and 2 assets, as referred to in Article 10, 11 and 12 of Commission Delegated Regulation (EU) 2015/61, attached to a covered bond issuance.

Or. en

Amendment 768Thomas MannProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 p – paragraph 4 – point c a (new)

Text proposed by the Commission Amendment

(ca) Assets from precious-metal financing transactions with a time frame of no more than 180 days, including metals held on behalf of the client, should be excluded from the calculation of the stable refinancing rate.

Or. de

Amendment 769Markus FerberProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 p – paragraph 6 a (new)

Text proposed by the Commission Amendment

6a. Institutions take no account of the following positions when making calculations:

(a) Positions resulting from services concerned with the resolution of precious-metal transactions;

(b) Positions resulting from precious-

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metal financing transactions with a time frame of no more than 180 days;

Or. de

Amendment 770Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 q – paragraph 1 a (new)

Text proposed by the Commission Amendment

1a. The residual maturity of assets with an undefined contractual end date is the date at which the contract allows the credit institution to withdraw or to request payment.

Or. en

Amendment 771Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 q – paragraph 1 b (new)

Text proposed by the Commission Amendment

1b. Securities contractually hedging a derivative have the maturity of the derivative.

Or. en

Amendment 772Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013428 q – paragraph 3 – subparagraph 1 a (new)

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Text proposed by the Commission Amendment

A 50% RSF factor applies to securities that are held on balance sheet to hedge an exposure to a client facing equity derivative which are in turn re-used or re-pledged, and the period of encumbrance is for between six months and one year. If a higher required stable funding factor would apply then this should override this treatment. A 100% required stable funding factor applies to equity securities held to hedge an institution’s exposure to an equity derivative where the security is held on balance sheet and is encumbered for a period of greater than one year.

Or. en

Justification

The stipulation of long term funding requirements for securities hedging derivatives which are re-used or re-pledged.

Amendment 773Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 q – paragraph 5 a (new)

Text proposed by the Commission Amendment

5a. When calculating the residual maturity of an asset with an early termination where the option to withdraw the money is exercisable at the discretion of both parts, the institution shall consider the asset at the maturity of the date in which the option can be exercised.

Or. en

Justification

Assets with early termination options exercisable by both counterparties of the transaction

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should be deemed to mature at the next exercise date. Based on the current definition, the borrower should consider the deposit as a short term deposit and the lender should consider the asset as a long term loan. Such an asymmetric treatment is financially inconsistent, since the borrower would not be willing to pay the lender a higher cost of funding, corresponding to a long term deposit, in the presence of an early termination option. From a financial perspective, if there are no exit penalties, the early repayment option exercisable by both parts should always allow the counterparty penalized by a change in market parameters to close the deal and renegotiate it with the new market conditions. Therefore the treatment of these transactions should be symmetric, with both sides (asset/liability) assigned to the same maturity bucket. These trades are made by regulated financial institutions and exit fees are not a typical feature. The bank can demonstrate that the expected maturity of these assets is different from the contractual maturity based on evidence that counterparties do exercise the early termination option when it is beneficial to do so.

Amendment 774Thomas MannProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 r – paragraph 1 – point f a (new)

Text proposed by the Commission Amendment

(fa) Assets from the provision of clearing and resolution services for precious metals should be excluded from the calculation of the stable refinancing rate.

Or. de

Amendment 775Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 r – paragraph 1 – point a

Text proposed by the Commission Amendment

(a) unencumbered assets eligible as Level 1 high quality liquid assets in accordance with Article 10 of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation , regardless of

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their compliance with the operational requirements as set out in Article 8 of that Delegated Regulation ;

Or. en

Amendment 776Andrea Cozzolino, Simona Bonafè, Luigi Morgano, Renato SoruProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 r – paragraph 1 – point a a (new)

Text proposed by the Commission Amendment

(aa) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3), where those assets are collateralised by assets that qualify as Level 1 assets under Chapter 2 of Title II of Delegated Regulation(EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation , and where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e (1) of this Regulation applies;

Or. en

Amendment 777Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 r – paragraph 1 – point a a (new)

Text proposed by the Commission Amendment

(aa) assets that have a residual

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maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3), where those assets are collateralised by assets that qualify as Level 1 assets under Chapter 2 of Title II of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation , and where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e of this Regulation applies;

Or. en

Justification

Same treatment should be envisaged for repo and reverse repo and lower than what the rapporteur has proposed.

Amendment 778Marco Zanni, Bernard Monot, Gerolf AnnemansProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 r – paragraph 1 – point a a (new)

Text proposed by the Commission Amendment

(aa) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market driven transactions as defined in Article 192(2) and (3) with financial customers, where those assets are collateralised by assets that qualify as Level 1 assets under Title II of Delegated Regulation (EU)2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation, and where the

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institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies;

Or. en

Amendment 779Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 r – paragraph 1 – point a a (new)

Text proposed by the Commission Amendment

(aa) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3), where those assets are collateralised by assets that qualify as Level 1 assets under Title II of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation , and where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies;

Or. en

Amendment 780Andrea Cozzolino, Simona Bonafè, Luigi Morgano, Renato SoruProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 r – paragraph 1 – point a b (new)

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Text proposed by the Commission Amendment

(ab) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with regulated financial entities, where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428(1) of this Regulation applies;

Or. en

Amendment 781Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 r – paragraph 1 – point a b (new)

Text proposed by the Commission Amendment

(ab) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with regulated financial customers, where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies;

Or. en

Amendment 782Anne Sander, Alain Cadec, Alain Lamassoure

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Proposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 r – paragraph 1 – point a b (new)

Text proposed by the Commission Amendment

(ab) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with regulated financial customers, where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e of this Regulation applies;

Or. en

Justification

Same treatment should be envisaged for repo and reverse repo and lower than what the rapporteur has proposed.

Amendment 783Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 r – paragraph 1 – point f a (new)

Text proposed by the Commission Amendment

(fa) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3), with credit institutions and other regulated financial institutions as defined in Delegated Regulation (EU) 2015/61, where those assets are collateralised by assets that qualify as Level 1 assets under

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Title II of Delegated Regulation (EU)2015/61, excluding high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation, and where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies;

Or. en

Justification

Repo transactions are a key component of the money market and provides a secured means of financing which is an essential mechanism for the efficient management of liquidity. The cost of borrowing, for corporates and governments, will increase substantially if repo transactions become uneconomic and there is not a well-functioning repo market. These significant effects will be felt by all clients of the banking industry, in addition to corporates and governments, including buy-side firms such as pension funds, insurance companies and asset managers which represent money invested in the economy. Reducing the RSF to 0% for those counterparties which are themselves subject to financial supervision and subject to a financial regulatory framework, will contribute to maintaining a liquid repo market, essential to providing the efficient redeployment of financial assets on the one side and providing HQLA for banks on the other. This in general will contribute to financial stability.

Amendment 784Markus FerberProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 r – paragraph 1 – point f a (new)

Text proposed by the Commission Amendment

(fa) Exposures resulting from services concerned with the resolution of precious-metal transactions;

Or. de

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Justification

Precious-metal positions can quickly be liquidated and should therefore be subjected to a risk weight similar to that of cash.

Amendment 785Markus FerberProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 r – paragraph 1 – point f b (new)

Text proposed by the Commission Amendment

(fb) Positions resulting from precious-metal financing transactions with a time frame of no more than 180 days;

Or. de

Justification

Precious-metal positions can quickly be liquidated and should therefore be subjected to a risk weight similar to that of cash.

Amendment 786Roberto GualtieriProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 r a (new)

Text proposed by the Commission Amendment

Article 428ra

2% required stable funding factor

The following assets shall be subject to a 2% required stable funding factor:

assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market driven transactions as defined in Article 192(2) and (3) with financial customers, where those assets are collateralised by assets that qualify as Level 1 assets under Title II of Delegated Regulation

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(EU)2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation, and where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies;

Or. en

Amendment 787Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point a a (new)

Text proposed by the Commission Amendment

(aa) unencumbered assets eligible as Level 1 high quality liquid assets in accordance with Article 10 of Delegated Regulation (EU) 2015/61, excluding:

(i) extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation , regardless of their compliance with the operational requirements as set out in Article 8 of that Delegated Regulation ;

(ii) assets receiving a 0% RSF as specified in Article 428r

Or. en

Amendment 788Andrea Cozzolino, Simona Bonafè, Luigi Morgano, Renato SoruProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point b

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Text proposed by the Commission Amendment

(b) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with financial customers, where those assets are collateralised by assets that qualify as Level 1 assets under Title II of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation , and where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies;

deleted

Or. en

Amendment 789Marco Zanni, Bernard Monot, Gerolf AnnemansProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point b

Text proposed by the Commission Amendment

(b) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with financial customers, where those assets are collateralised by assets that qualify as Level 1 assets under Title II of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation , and where the institution would be legally entitled and operationally able to reuse those assets for

deleted

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the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies;

Or. en

Amendment 790Fulvio MartuscielloProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point b

Text proposed by the Commission Amendment

(b) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with financial customers, where those assets are collateralised by assets that qualify as Level 1 assets under Title II of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation , and where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies;

deleted

Or. en

Amendment 791Roberto GualtieriProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point b

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Text proposed by the Commission Amendment

(b) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with financial customers, where those assets are collateralised by assets that qualify as Level 1 assets under Title II of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation , and where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies;

deleted

Or. en

Amendment 792Ashley FoxProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point b

Text proposed by the Commission Amendment

(b) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with financial customers, where those assets are collateralised by assets that qualify as Level 1 assets under Title II of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation , and where the institution would be legally entitled and operationally able to reuse those assets for

deleted

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the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies;

Or. en

Amendment 793Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point b

Text proposed by the Commission Amendment

(b) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with financial customers, where those assets are collateralised by assets that qualify as Level 1 assets under Title II of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation , and where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies;

deleted

Or. en

Justification

Repo transactions are a key component of the money market and provides a secured means of financing which is an essential mechanism for the efficient management of liquidity. The cost of borrowing, for corporates and governments, will increase substantially if repo transactions become uneconomic and there is not a well-functioning repo market. These significant effects will be felt by all clients of the banking industry, in addition to corporates and governments, including buy-side firms such as pension funds, insurance companies and asset managers

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which represent money invested in the economy. Reducing the RSF to 0% for those counterparties which are themselves subject to financial supervision and subject to a financial regulatory framework, will contribute to maintaining a liquid repo market, essential to providing the efficient redeployment of financial assets on the one side and providing HQLA for banks on the other. This in general will contribute to financial stability.

Amendment 794Matt Carthy, Martin SchirdewanProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point b

Text proposed by the Commission Amendment

(b) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with financial customers, where those assets are collateralised by assets that qualify as Level 1 assets under Title II of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation , and where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies;

deleted

Or. en

Amendment 795Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point b

Text proposed by the Commission Amendment

(b) assets that have a residual deleted

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maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with financial customers, where those assets are collateralised by assets that qualify as Level 1 assets under Title II of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation , and where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies;

Or. en

Justification

The Commission proposal takes on board the Repo/Reverse Repo asymmetry from Basel which has adverse effects on market liquidity: Outright L1 RSF 0% vs L1 sourced by Reverse Repo RSF 5% vs L1 funded via repo ASF 0%. Non-economic terms and conditions may force banks to refrain from primary and secondary markets as well as from secured funding which may hamper the liquidity also from HQLA resulting in non-eligibility even of high quality assets for purpose of LCR and NSFR (since no deep liquid private repo market is left). It is proposed to set RSF for Reverse Repo on L1 collateral to 0%.More generally, to ensure market liquidity and be consistent with the development of the Capital Market Union, it is recommended that reverse repo are treated symmetrically to repos when they are executed with regulated financial institutions.

Amendment 796Roberto GualtieriProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – points b a and b b (new)

Text proposed by the Commission Amendment

(ba) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market driven transactions as

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defined in Article192(2) and (3) with financial customers, other than those referred to in point (b) of Article 428s. Those assets shall be taken into account on a net basis where Article428e(1) applies;

(bb) assets that have a residual maturity of less than six months resulting from transactions with financial customers other than those referred to in point (b) of Article428s and in point (a) of this Article;

Or. en

Amendment 797Marco Zanni, Bernard Monot, Gerolf AnnemansProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point b a (new)

Text proposed by the Commission Amendment

(ba) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market driven transactions as defined in Article192(2) and (3) with financial customers, other than those referred to in point (b) of Article 428s. Those assets shall be taken into account on a net basis where Article428e(1) applies;

Or. en

Amendment 798Marco Zanni, Bernard Monot, Gerolf AnnemansProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point b b (new)

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Text proposed by the Commission Amendment

(bb) assets that have a residual maturity of less than six months resulting from transactions with financial customers other than those referred to in point (b) of Article428s and in point (a) of this Article;

Or. en

Amendment 799Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point d

Text proposed by the Commission Amendment

(d) trade finance off-balance sheet related products as referred to in Article 111(1) of this Regulation with a residual maturity of less than six months.

(d) trade finance and short term trade receivables financing techniques off-balance sheet related products as referred to in Article 429, and Annex I of Regulation (EU) n°575/2013.

Or. en

Justification

Trade Finance plays a key role in the real economy as it enables the financing of commercial transactions of exporting and importing firms via lending, issuing letters of credit or trade related guarantees. In light of the data and international practice, RSF assignment for off-balance sheet trade finance products, including letters of credit and bank guarantees, should be independent from maturity and set at a maximum of 5%.

Amendment 800Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point d

Text proposed by the Commission Amendment

(d) trade finance off-balance sheet (d) all trade finance off-balance sheet

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related products as referred to in Article 111(1) of this Regulation with a residual maturity of less than six months.

related products as referred to in Article 111(1) of this Regulation.

Or. en

Amendment 801Ashley FoxProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – points d a (new)

Text proposed by the Commission Amendment

(da) For all netting sets of derivative contracts subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 5% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

Or. en

Amendment 802Anne Sander, Alain Lamassoure, Alain CadecProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point d a (new)

Text proposed by the Commission Amendment

(da) For all netting sets of derivative contracts subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 5% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

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Or. en

Justification

The Basel Committee stressed that its approach on derivatives liabilities might be over conservative and has proposed to allow jurisdictions to apply a RSF between 20 and 5%.5% should be retained

Amendment 803Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point d a (new)

Text proposed by the Commission Amendment

(da) equity securities held to hedge an institution’s exposure to a client facing equity derivative which has been funded by initial margin. The initial margin should at a minimum cover the value of the equity securities held and the securities should be the same as the underlying exposure of the equity derivative transaction.

Or. en

Amendment 804Ashley FoxProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point d b (new)

Text proposed by the Commission Amendment

(db) For all netting sets of derivative contracts that are not subject to a regular margin agreements under which institutions post variation margins to their counterparties but which are subject to contractual clauses which could lead to collateral to post, dependent on specific trigger events such as a downgrade for example, institutions shall apply a 5%

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required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value. When exempt from such clauses, the netting sets that are not subject to variation margins agreement shall receive a 0% required stable funding factor.

Or. en

Amendment 805Anne Sander, Alain Lamassoure, Alain CadecProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point d b (new)

Text proposed by the Commission Amendment

(db) For all netting sets of derivative contracts that are not subject to a regular margin agreements under which institutions post variation margins to their counterparties but which are subject to contractual clauses which could lead to collateral to post, dependent on specific trigger events such as a downgrade for example, institutions shall apply a 5% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

Or. en

Justification

The Basel Committee stressed that its approach on derivatives liabilities might be over conservative and has proposed to allow jurisdictions to apply a RSF between 20 and 5%.5% should be retained

Amendment 806Caroline Nagtegaal, Thierry Cornillet

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Proposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – point d b (new)

Text proposed by the Commission Amendment

(db) For all netting sets of derivative contracts subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 5% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

Or. en

Justification

Reflects the treatment of derivatives in the new Basel agreement.

Amendment 807Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – paragraph 1 a (new)

Text proposed by the Commission Amendment

1a. For all netting sets of derivative contracts, institutions shall apply a 5% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

Or. en

Justification

At its meeting on 4-5 October, the BCBS agreed to allow national discretion for the NSFR's treatment of derivative liabilities in the sense that jurisdictions may lower the value of the

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assigned 20% required stable funding factor to derivative liabilities with a floor of 5% to facilitate the implementation of the NSFR. This shall prevent uncertainty and contribute to a robust and efficient derivatives market.

Amendment 808Neena GillProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 s – paragraph 1 a (new)

Text proposed by the Commission Amendment

1a. For all netting sets of derivative contracts, institutions shall apply a 5%required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

Or. en

Amendment 809Marco Zanni, Bernard Monot, Gerolf AnnemansProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 u – paragraph 1 – point a

Text proposed by the Commission Amendment

(a) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with financial customers, other than those referred to in point (b) of Article 428s. Those assets shall be taken into account on a net basis where Article 428e(1) applies;

deleted

Or. en

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Amendment 810Roberto GualtieriProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 u – paragraph 1 – point a

Text proposed by the Commission Amendment

(a) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with financial customers, other than those referred to in point (b) of Article 428s. Those assets shall be taken into account on a net basis where Article 428e(1) applies;

deleted

Or. en

Amendment 811Matt Carthy, Martin SchirdewanProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 u – paragraph 1 – point a

Text proposed by the Commission Amendment

(a) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with financial customers, other than those referred to in point (b) of Article 428s. Those assets shall be taken into account on a net basis where Article 428e(1) applies;

(a) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with financial customers, where those assets are collateralised by assets that qualify as Level 1 assets under Title II of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation , and where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets

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into account on a net basis where Article 428e(1) of this Regulation applies

Or. en

Amendment 812Matt Carthy, Martin SchirdewanProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 u – paragraph 1 – point b

Text proposed by the Commission Amendment

(b) assets that have a residual maturity of less than six months resulting from transactions with financial customers other than those referred to in point (b) of Article 428s and in point (a) of this Article;

deleted

Or. en

Amendment 813Marco Zanni, Bernard Monot, Gerolf AnnemansProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 u – paragraph 1 – point b

Text proposed by the Commission Amendment

(b) assets that have a residual maturity of less than six months resulting from transactions with financial customers other than those referred to in point (b) of Article 428s and in point (a) of this Article;

deleted

Or. en

Amendment 814Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114

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Regulation (EU) No 575/2013Article 428 u – paragraph 1 – point d

Text proposed by the Commission Amendment

(d) trade finance off-balance sheet related products as referred to in Article 111(1) with a residual maturity of minimum six months and less than one year.

deleted

Or. en

Amendment 815Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 u – paragraph 1 – point d

Text proposed by the Commission Amendment

(d) trade finance off-balance sheet related products as referred to in Article 111(1) with a residual maturity of minimum six months and less than one year.

deleted

Or. en

Justification

Trade Finance plays a key role in the real economy as it enables the financing of commercial transactions of exporting and importing firms via lending, issuing letters of credit or trade related guarantees. In light of the data and international practice, RSF assignment for off-balance sheet trade finance products, including letters of credit and bank guarantees, should be independent from maturity and set at a maximum of 5%.

Amendment 816Matt Carthy, Martin SchirdewanProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 u – paragraph 2

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Text proposed by the Commission Amendment

2. For all netting sets of derivative contracts that are not subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 10% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

deleted

Or. en

Amendment 817Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 u – paragraph 2

Text proposed by the Commission Amendment

2. For all netting sets of derivative contracts that are not subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 10% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

deleted

Or. en

Justification

Basel compliance

Amendment 818Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 114

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Regulation (EU) No 575/2013Article 428 u – paragraph 2

Text proposed by the Commission Amendment

2. For all netting sets of derivative contracts that are not subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 10% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

deleted

Or. en

Justification

At its meeting on 4-5 October, the BCBS agreed to allow national discretion for the NSFR's treatment of derivative liabilities in the sense that jurisdictions may lower the value of the assigned 20% required stable funding factor to derivative liabilities with a floor of 5% to facilitate the implementation of the NSFR. In view of this decision this amendment deletes the 10% RSF requirement for derivative contracts that are not subject to margin agreements.

Amendment 819Marco ValliProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 u – paragraph 2

Text proposed by the Commission Amendment

2. For all netting sets of derivative contracts that are not subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 10% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

2. For all netting sets of derivative contracts that are not subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 20% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

Or. en

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Justification

Unmargined derivative contracts should be subject to a 20% RSF factor (min. 15%).

Amendment 820Matt Carthy, Martin SchirdewanProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 w – point a a (new)

Text proposed by the Commission Amendment

(aa) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3) with financial customers, other than those referred to in point (a) of Article 428u. Those assets shall be taken into account on a net basis where Article 428e(1) applies

Or. en

Amendment 821Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 w – point b

Text proposed by the Commission Amendment

(b) trade finance off-balance sheet related products as referred to in Article 111(1)with a residual maturity of one year or more.

deleted

Or. en

Justification

Trade Finance plays a key role in the real economy as it enables the financing of commercial transactions of exporting and importing firms via lending, issuing letters of credit or trade related guarantees. In light of the data and international practice, RSF assignment for off-

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balance sheet trade finance products, including letters of credit and bank guarantees, should be independent from maturity and set at a maximum of 5%.

Amendment 822Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 w – point b

Text proposed by the Commission Amendment

(b) trade finance off-balance sheet related products as referred to in Article 111(1)with a residual maturity of one year or more.

deleted

Or. en

Amendment 823Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114 (new)Regulation (EU) No 575/2013Article 428 w – point b a (new)

Text proposed by the Commission Amendment

(ba) equity securities, or relevant portions of equity securities, held to hedge an institution’s exposure to a client facing equity derivative which would qualify as Level 2B liquid assets in accordance with Article 12 of Delegated Regulation (EU) 2015/61 and which are the same as the underlying exposure of the equity derivative transaction but:- the institution has not received initial margin; or,- the value of the equity securities exceeds the value of initial margin received.

Or. en

Amendment 824Jeppe Kofod

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Proposal for a regulationArticle 1 – paragraph 1 – point 114 (new)Regulation (EU) No 575/2013Article 428 w – point b a (new)

Text proposed by the Commission Amendment

(ba) unencumbered covered bonds with a credit quality step 1 credit assessment that do not meet the minimum issue size for extremely high quality covered bonds or high quality covered bonds in accordance with point (f)(iv) of Article 10(1), point (c)(iv) of Article 11(1) or point (e)(iv) of Article 12(1) of Delegated Regulation (EU) 2015/61, but meet the requirements for high quality covered bonds laid down in points (I), (ii), (iii), and (iv) in Article 10(1),

Or. en

Amendment 825Roberto GualtieriProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 w – subparagraph 1 a (new)

Text proposed by the Commission Amendment

For all netting sets of derivative contracts subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 5% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

Or. en

Amendment 826Matt Carthy, Martin SchirdewanProposal for a regulationArticle 1 – paragraph 1 – point 114

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Regulation (EU) No 575/2013Article 428 w – point b a (new)

Text proposed by the Commission Amendment

(ba) assets that have a residual maturity of less than six months resulting from transactions with financial customers other than those referred to in point (a) of Article 428u and in point (a) of this Article.

Or. en

Amendment 827Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 x – paragraph 2

Text proposed by the Commission Amendment

2. For all netting sets of derivative contracts subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 20% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

deleted

Or. en

Justification

At its meeting on 4-5 October, the BCBS agreed to allow national discretion for the NSFR's treatment of derivative liabilities in the sense that jurisdictions may lower the value of the assigned 20% required stable funding factor to derivative liabilities with a floor of 5% to facilitate the implementation of the NSFR. This shall prevent uncertainty and contribute to a robust and efficient derivatives market. The factor is specified in the amendment to Article 428s (2) (new).

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Amendment 828Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 x – paragraph 2

Text proposed by the Commission Amendment

2. For all netting sets of derivative contracts subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 20% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

deleted

Or. en

Justification

Reflects the treatment of derivatives in the new Basel agreement.

Amendment 829Anne Sander, Alain Lamassoure, Alain CadecProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 x – paragraph 2

Text proposed by the Commission Amendment

2. For all netting sets of derivative contracts subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 20% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

deleted

Or. en

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Justification

It is proposed to apply a RSF of 5% on derivatives liabilities. To be coherent this paragraph needs to be deleted

Amendment 830Matt Carthy, Martin SchirdewanProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 x – paragraph 2

Text proposed by the Commission Amendment

2. For all netting sets of derivative contracts subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 20% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

2. For all netting sets of derivative contracts institutions shall apply a 20%required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

Or. en

Amendment 831Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 x – paragraph 2

Text proposed by the Commission Amendment

2. For all netting sets of derivative contracts subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 20% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

2. For all netting sets of derivative contracts institutions shall apply a 20% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

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Or. en

Justification

Basel compliance

Amendment 832Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 x – paragraph 3

Text proposed by the Commission Amendment

3. An institution may replace the stable funding requirement set out in paragraph 2 for all netting sets of derivative contracts subject to margin agreements under which an institution posts variation margins to its counterparty with the amount of required stable funding calculated as the absolute amount of the difference between:

deleted

(a) for all netting sets with negative market value, gross of collateral posted, and which are subject to a margin agreement under which the institution posts variation margin to its counterparty, the sum of all the risk category Addon(a)

calculated in accordance with Article 278(1);

(b) for all netting sets with positive market value, gross of collateral received, and which are subject to a margin agreement under which the institution receives variation margin from its counterparty, the sum of all the risk category Addon(a) calculated in accordance with Article 278(1).

For the purpose of this calculation and in order to determine the risk position of derivative contracts included in the netting sets referred to in the first sub-paragraph, institutions shall replace the maturity factor calculated in accordance

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with point (b) of Article 279c(1) by either the maturity factor calculated in accordance with point (a) of Article 279c(1) or by the value of 1.

Or. en

Justification

Since the evaluation of the refinancing risks of derivative contracts with the help of the SA-CCR was not addressed in the negotiations of the Basel Committee on Banking Supervision and since it is generally not considered an adequate alternative to the calculation of the refinancing risks, this provision shall be deleted.

Amendment 833Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 x – paragraph 3

Text proposed by the Commission Amendment

3. An institution may replace the stable funding requirement set out in paragraph 2 for all netting sets of derivative contracts subject to margin agreements under which an institution posts variation margins to its counterparty with the amount of required stable funding calculated as the absolute amount of the difference between:

deleted

(a) for all netting sets with negative market value, gross of collateral posted, and which are subject to a margin agreement under which the institution posts variation margin to its counterparty, the sum of all the risk category Addon(a)

calculated in accordance with Article 278(1);

(b) for all netting sets with positive market value, gross of collateral received, and which are subject to a margin agreement under which the institution receives variation margin from its counterparty, the sum of all the risk

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category Addon(a) calculated in accordance with Article 278(1).

For the purpose of this calculation and in order to determine the risk position of derivative contracts included in the netting sets referred to in the first sub-paragraph, institutions shall replace the maturity factor calculated in accordance with point (b) of Article 279c(1) by either the maturity factor calculated in accordance with point (a) of Article 279c(1) or by the value of 1.

Or. en

Justification

It is proposed to apply a RSF of 5% on derivatives liabilities. To be coherent this paragraph needs to be deleted

Amendment 834Ashley FoxProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 x – paragraph 3 – point a

Text proposed by the Commission Amendment

(a) for all netting sets with negative market value, gross of collateral posted, and which are subject to a margin agreement under which the institution posts variation margin to its counterparty, the sum of all the risk category Addon(a)

calculated in accordance with Article 278(1);

(a) for all netting sets with negative market value, net of collateral posted, and which are subject to a margin agreement under which the institution posts variation margin to its counterparty, the sum of all the risk category Addon(a) calculated in accordance with Article 278(1);

Or. en

Amendment 835Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 x – paragraph 3 – point a a (new)

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Text proposed by the Commission Amendment

(aa) trade finance on-balance sheet related products with a residual maturity of minimum six months and less than one year;

Or. en

Amendment 836Ashley FoxProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 x – paragraph 3 – point b

Text proposed by the Commission Amendment

(b) for all netting sets with positive market value, gross of collateral received, and which are subject to a margin agreement under which the institution receives variation margin from its counterparty, the sum of all the risk category Addon(a) calculated in accordance with Article 278(1).

(b) for all netting sets with positive market value, net of collateral received, and which are subject to a margin agreement under which the institution receives variation margin from its counterparty, the sum of all the risk category Addon(a) calculated in accordance with Article 278(1).

Or. en

Amendment 837Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 x – paragraph 4

Text proposed by the Commission Amendment

4. Institutions that use the methods set out in Sections 4 or 5 of Chapter 6 of Title II of Part Three to determine the exposure value of their derivative contracts shall not apply the stable funding requirement set out in paragraph 2 of this Article to netting sets of derivative contracts subject to margin

deleted

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agreements under which institutions post variation margins to their counterparties and where those netting sets have a negative market value.

Or. en

Justification

Since the evaluation of the refinancing risks of derivative contracts with the help of the SA-CCR was not addressed in the negotiations of the Basel Committee on Banking Supervision and since it is generally not considered an adequate alternative to the calculation of the refinancing risks, this provision shall be deleted.

Amendment 838Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 y

Text proposed by the Commission Amendment

Article 428y deleted

25% required stable funding factor

[...]

Or. en

Amendment 839Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a a – point a

Text proposed by the Commission Amendment

(a) unencumbered Level 2B securitisations referred to in point (b) of Article 13(14) of Delegated Regulation (EU) 2015/61, regardless of their compliance with the operational requirements and with the requirements on the composition of the liquidity buffer as set out in Articles 8 and 17 of that

deleted

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Delegated Regulation;

Or. en

Justification

Under the BCBS approach (October 2014),residential mortgage -backed securities with a rating of at least AA are assigned a 50% RSF factor.

Amendment 840Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a c – point a

Text proposed by the Commission Amendment

(a) unencumbered assets eligible as Level 2B assets in accordance with Article 12 of Delegated Regulation (EU) 2015/61, excluding Level 2B securitisations and high quality covered bonds referred to in points (a) and (e) of Article 12(1) of that Delegated Regulation, regardless of their compliance with the operational requirements and with the requirements on the composition of the liquidity buffer as set out in Articles 8 and 17 of that Delegated Regulation;

(a) unencumbered assets eligible as Level 2B assets in accordance with Article 12 of Delegated Regulation (EU) 2015/61, excluding Level 2B securitisations and high quality covered bonds referred to in points (a) and (e) of Article 12(1) of that Delegated Regulation, and equity securities described in Article 428rs(d) or Article 428w(c) regardless of their compliance with the operational requirements and with the requirements on the composition of the liquidity buffer as set out in Articles 8 and 17 of that Delegated Regulation;

Or. en

Amendment 841Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a c – point a

Text proposed by the Commission Amendment

(a) unencumbered assets eligible as Level 2B assets in accordance with Article

(a) unencumbered assets eligible as Level 2B assets in accordance with Article

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12 of Delegated Regulation (EU) 2015/61, excluding Level 2B securitisations and high quality covered bonds referred to in points (a) and (e) of Article 12(1) of that Delegated Regulation, regardless of their compliance with the operational requirements and with the requirements on the composition of the liquidity buffer as set out in Articles 8 and 17 of that Delegated Regulation;

12 of Delegated Regulation (EU) 2015/61, excluding high quality covered bonds referred to in points (a) and (e) of Article 12(1) of that Delegated Regulation, regardless of their compliance with the operational requirements and with the requirements on the composition of the liquidity buffer as set out in Articles 8 and 17 of that Delegated Regulation;

Or. en

Justification

Under the BCBS approach (October 2014),residential mortgage -backed securities with a rating of at least AA are assigned a 50% RSF factor.

Amendment 842Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a c – point e

Text proposed by the Commission Amendment

(e) trade finance on-balance sheet related products with a residual maturity of minimum six months and less than one year;

deleted

Or. en

Amendment 843Peter SimonProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a c – point f a (new)

Text proposed by the Commission Amendment

(fa) assets used for providing clearing and settlement services of precious metals such as gold, silver, platinum and

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palladium;

Or. en

Justification

A RSF of 85% for clearing and settlement services for the most liquid precious metals such as gold, silver, platinum and palladium would hamper clearing and settlement of precious metals and increase market prices for such services significantly.

Amendment 844Peter SimonProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a c – point f b (new)

Text proposed by the Commission Amendment

(fb) assets used for providing financing transactions of precious metals such as gold, silver, platinum and palladium of a term of 180 days or less;

Or. en

Justification

A RSF of 85% for financing transactions for the most liquid precious metals such as gold, silver, platinum and palladium would hamper precious metals financing and increase market prices for such services significantly.

Amendment 845Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a c – point g a (new)

Text proposed by the Commission Amendment

(ga) equity securities, or relevant portions of equity securities, held to hedge an institution’s exposure to a client facing equity derivative which would not qualify as Level 2B liquid assets in accordance

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with Article 12 of Delegated Regulation (EU) 2015/61 and which are the same as the underlying exposure of the equity derivative transaction but:

– the institution has not received initial margin; or,

– the value of the equity securities exceeds the value of initial margin received.

Or. en

Amendment 846Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a c – point g a (new)

Text proposed by the Commission Amendment

(ga) those assets referred in Article 428af that have been purchased with the intent of being sold within one year;

Or. en

Amendment 847Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a e – point b a (new)

Text proposed by the Commission Amendment

(ba) any assets other than those referred to in Articles 428r to 428af, including loans to financial customers having a residual contractual maturity of one year or more when collateralized by Level 1 high quality liquid assets in accordance with Article10 of Delegated Regulation (EU) 2015/61.

Or. en

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Amendment 848Caroline NagtegaalProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a f – point c

Text proposed by the Commission Amendment

(c) unencumbered loans with a residual maturity of one year or more, excluding loans to financial customers and loans referred to in Article 428r to 428ae, which are not past due for more than 90 days and which are assigned a risk weight of more than 35% in accordance with Chapter 2 of Title II of Part Three;

(c) unencumbered loans with a residual maturity of one year or more, excluding loans to financial customers, residential mortgage loans and loans referred to in Article 428r to 428ae, which are not past due for more than 90 days and which are assigned a risk weight of more than 35% in accordance with Chapter 2 of Title II of Part Three;

Or. en

Justification

The EC proposal is not granular and does not fully take into account the actual risk profile.

Amendment 849Caroline NagtegaalProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a f – point c a (new)

Text proposed by the Commission Amendment

(ca) The part of the residential mortgage loans that exceeds 75% of the market value of the property in question or 75% of the mortgage lending value of the property in question;

Or. en

Justification

The EC proposal is not granular and does not fully take into account the actual risk profile.

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Amendment 850Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a f – point f

Text proposed by the Commission Amendment

(f) unencumbered exchange-traded equities that are not eligible as Level 2B assets in accordance with Article 12 of Delegated Regulation (EU) 2015/61;

(f) unencumbered exchange-traded equities that are not eligible as Level 2B assets in accordance with Article 12 of Delegated Regulation (EU) 2015/61 unless they have been purchased with the intent of being sold within one year;

Or. en

Amendment 851Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a f – point f

Text proposed by the Commission Amendment

(f) unencumbered exchange-traded equities that are not eligible as Level 2B assets in accordance with Article 12 of Delegated Regulation (EU) 2015/61;

(f) unencumbered exchange-traded equities that are not eligible as Level 2B assets in accordance with Article 12 of Delegated Regulation (EU) 2015/61, excluding equity securities described in Article 428s(d) or Article428ac(h);

Or. en

Amendment 852Peter SimonProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a f – point g

Text proposed by the Commission Amendment

(g) physical traded commodities, including gold but excluding commodity

(g) physical traded commodities, including gold, but excluding commodity

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derivatives. derivatives and assets held for transactions that are not covered by Article 428ac (fa) and (fb).

Or. en

Justification

A RSF of 85% for clearing and settlement services as well as financing transactions for the most liquid precious metals such as gold, silver, platinum and palladium would hamper clearing, settlement and financing transactions for precious metals and increase market prices for such services significantly.

Amendment 853Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a f – point g

Text proposed by the Commission Amendment

(g) physical traded commodities, including gold but excluding commodity derivatives.

(g) physical traded commodities, including gold but excluding commodity derivatives, unless they have been purchased with the intent of being sold within one year.

Or. en

Amendment 854Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a f – point g a (new)

Text proposed by the Commission Amendment

(ga) encumbered assets with a residual maturity of one year or more in a cover pool funded by covered bonds as referred to in Article 52(4) of Directive 2009/65/EC or covered bonds which meet the eligibility requirements for the treatment as set out in Article 129(4) or

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(5).

Or. en

Justification

The aim to limit maturity transformation is both, desirable and justified from a prudential perspective. At the same time, it is important to maintain, to the extent possible, a level playing field between different funding sources. To allow for an equal treatment of assets in the cover pool of covered bonds, this amendment lowers the RSF for encumbered assets while adhering to the aim to reduce maturity transformation.

Amendment 855Barbara KappelProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a f – point g a (new)

Text proposed by the Commission Amendment

(ga) any assets other than those referred to in Articles 428r to 428af, including loans to financial customers having a residual contractual maturity of one year or more when collateralized by Level 2 liquid assets in accordance with Article 10 of Delegated Regulation (EU) 2015/6.

Or. en

Amendment 856Jeppe KofodProposal for a regulationArticle 1 – paragraph 1 – point 114 (new)Regulation (EU) No 575/2013Article 428 a f – point h (new)

Text proposed by the Commission Amendment

(h) encumbered assets with a residual maturity of one year or more in a cover pool funded by covered bonds as referred to in Article 52(4) of Directive 2009/65/EC or covered bonds that meet

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the eligibility requirements for the treatment set out in Article 129(4) or (5)

Or. en

Amendment 857Rina Ronja KariProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a f – point g a (new)

Text proposed by the Commission Amendment

(ga) encumbered assets with a residual maturity of one year or more in a cover pool funded by covered bonds as referred to in Article 52(4) of Directive 2009/65/EC or covered bonds that meet the eligibility requirements for the treatment set out in Article 129(4) or (5).

Or. en

Justification

In its current form the NSFR favours unsecured debt over secured debt. Identical asset would receive a better weighting if backed by unsecured debt. This not only goes against the principle of a level playing field, as it penalises covered bond, but it also incentivises a shift towards shorter dated and more expensive unsecured funding.

Amendment 858Gunnar HökmarkProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a f – point g a (new)

Text proposed by the Commission Amendment

(ga) encumbered assets with a residual maturity of one year or more in a cover pool funded by covered bonds that meet the eligibility requirements for the treatment set out in Article 129(4) or (5).

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Or. en

Justification

Several national banking systems in Europe use covered bonds as the main funding source for mortgages. The Basel Committee has when creating the NSFR not considered the specifics of covered bonds, and as the NSFR stands, it completely disincentives banks to use covered bonds for mortgage funding. In order to align the NSFR with European market practices, the RSF factor for mortgages funded through covered bonds should be lowered from 100 % to 85 %.

Amendment 859Fulvio MartuscielloProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 r – point a a (new)

Text proposed by the Commission Amendment

(aa) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3), cleared through a CCP, where those assets are collateralised by assets that qualify as Level 1 assets under Title II of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation, and where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies;

Or. en

Amendment 860Fulvio MartuscielloProposal for a regulationArticle 1 – paragraph 1 – point 114

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Regulation (EU) No 575/2013Article 428 r – point a b (new)

Text proposed by the Commission Amendment

(ab) assets that have a residual maturity of less than six months resulting from secured lending transactions and capital market driven transactions as defined in Article 192(2) and (3) with regulated financial costumers, where the institution would be legally entitled and operationally able to reuse those assets for the life of the transaction, regardless of whether the collateral has already been reused. Institutions shall take those assets into account on a net basis where Article 428e(1) of this Regulation applies.

Or. en

Amendment 861Peter SimonProposal for a regulationArticle 1 – paragraph 1 – point 114Regulation (EU) No 575/2013Article 428 a r (new)

Text proposed by the Commission Amendment

3a. Article 428ar

10% required stable funding factor

1. Unencumbered assets eligible as Level 1 extremely high quality covered bonds in accordance with point (f) of Article 10(1) of Delegated Regulation (EU) 2015/61 shall be subject to a 10% required stable funding factor, regardless of their compliance with the operational requirements and with the requirements on the composition of the liquidity buffer as set out in Articles 8 and 17 of that Delegated Regulation.

2. For all netting sets of derivative contracts that are not subject to margin agreements under which institutions post variation margins to their counterparties,

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institutions shall apply a 10% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

Or. en

Justification

Unencumbered assets eligible as Level 1 extremely high quality covered bonds should be considered with a 10% required stable funding factor under the simplified version of the net stable funding ratio. As unencumbered assets eligible as Level 1 extremely high quality covered bonds are considered with a 7% required stable funding factor under the full Basel NSFR, the assignment to the 10% required stable funding category represents a stricter calibration from a prudential perspective. This amendment should be seen in connection with new Chapter 4b of the draft report.

Amendment 862Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 a (new)Regulation (EU) No 575/2013Part 6 – Title IV – Chapter 4 a (new)

Text proposed by the Commission Amendment

(114a) In Part 6, Title IV, the following Chapter 4a is added:

"CHAPTER 4a

Available stable refinancing for the simplified net stable funding ratio

SECTION 1

GENERAL PROVISIONS

Article 428ah

Calculation of the amount of available stable funding

By derogation from Chapter 3 and unless otherwise specified in this Chapter, for small and non-complex institutions, the amount of available stable funding shall be calculated by multiplying the accounting value of various categories or

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types of liabilities and regulatory capital by the appropriate available stable funding factors to be applied under Section 2. The total amount of available stable funding shall be the sum of the weighted amounts of liabilities and regulatory capital."

Or. en

Justification

Introducing a simplified NSFR for small and non-complex institutions as defined in Article 430a.

Amendment 863Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 b (new)Regulation (EU) No 575/2013Article 428 a i (new)

Text proposed by the Commission Amendment

Article 428ai

Residual maturity of a liability or regulatory capital

1. Unless otherwise specified in this Chapter, institutions shall take into account the residual contractual maturity of their liabilities and regulatory capital to determine the appropriate available stable funding factors to be applied under Section 2 of this Chapter.

2. Institutions shall take into account existing options to determine the residual maturity of a liability or of regulatory capital. They shall do so on the assumption that investors will redeem a call option at the earliest possible date. For options exercisable at the discretion of the institution, the institution and the competent authorities shall take into account reputational factors that may limit the institution’s ability not to exercise the option, considering in

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particular market expectations that institutions should redeem certain liabilities before their maturity.

(sNSFR)

Or. en

Amendment 864Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 c (new)Regulation (EU) No 575/2013Article 428 a j (new)

Text proposed by the Commission Amendment

SECTION 2

AVAILABLE STABLE FUNDING FACTORS

Article 428aj

0% available stable funding factor

Unless otherwise specified in this section, all liabilities without a stated maturity, including short positions and open maturity positions, shall be subject to a 0% available stable funding factor with the exception of the following:

(a) deferred tax liabilities, which shall be treated in accordance with the nearest possible date on which such liabilities could be realised;

(b) minority interests, which shall be treated in accordance with the term of the instrument concerned. Deferred tax liabilities and minority interests shall be subject to one of the following factors:

(i) 0%, where the effective residual maturity of the deferred tax liability or minority interest is less than one year;

(ii) 100%, where the effective residual maturity of the deferred tax liability or minority interest is one year or more.

2. The following liabilities shall be subject to a 0% available stable funding

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factor:

(a) trade date payables arising from purchases of financial instruments, foreign currencies and commodities that are expected to settle within the standard settlement cycle or period that is customary for the relevant exchange or type of transaction, or that have failed to be settled, but are still expected to settle;

(b) liabilities that are categorised as interdependent with assets in accordance with Article 428f;

(c) liabilities with a residual maturity of less than one year provided by:

(i) the ECB or the central bank of a Member State;

(ii) the central bank of a third country;

(iii) financial customers;

(d) any other liabilities and capital items or instruments not referred to in Articles 428aj to 428am.

3. Institutions shall apply a 0% available stable funding factor to the absolute value of the difference, if negative, between the sum of market values across all netting sets with positive market value and the sum of market values across all netting sets with negative market value calculated in accordance with Article 428d. of this Regulation.

The following rules shall apply to the calculation referred to in the first subparagraph:

(a) variation margins received by institutions from their counterparties shall be deducted from the market value of a netting set with positive market value where the collateral received as variation margins qualifies as Level 1 assets under Title II of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of Delegated Regulation

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(EU) 2015/61, and that institutions are legally entitled and operationally able to reuse;

(b) all variation margin posted by institutions to their counterparties shall be deducted from the market value of a netting set with negative market value.

(sNSFR)

Or. en

Amendment 865Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 d (new)Regulation (EU) No 575/2013Article 428 a k (new)

Text proposed by the Commission Amendment

Article 428ak

50% available stable funding factor

By way of derogation from Article 428k, the following liabilities shall be subject to a 50% available stable funding factor: liabilities with a residual maturity of less than one year provided by:

(i) the central government of a Member State or a third country;

(ii) regional governments or local authorities in a Member State or a third country;

(iii) public sector entities of a Member State or a third country;

(iv) multilateral development banks referred to in Article 117(2) and international organisations referred to in Article 118;

(v) credit institutions as referred to in point (e) of Article 10(1) of Delegated Regulation (EU) 2015/61;

(vi) non-financial corporate customers;

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(vii) credit unions authorised by a competent authority, personal investment companies and clients that are deposit brokers, with the exception of deposits received, that fulfil the criteria for operational deposits as set out in Article 27 of Delegated Regulation (EU) 2015/61.

(sNSFR)

Or. en

Amendment 866Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 e (new)Regulation (EU) No 575/2013Article 428 a l (new)

Text proposed by the Commission Amendment

Article 428al

90% available stable funding factor

By way of derogation from Article 428aj, sight retail deposits and term retail deposits having a residual maturity of less than one year that fulfil the criteria set out in Articles 24 or 25 of Delegated Regulation (EU) 2015/61 shall be subject to a 90% available stable funding factor.

(sNSFR)

Or. en

Amendment 867Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 f (new)Regulation (EU) No 575/2013Article 428 a m (new)

Text proposed by the Commission Amendment

Article 428am

100% available stable funding factor

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By way of derogation from Article 428aj, the following liabilities and capital items and instruments shall be subject to a 100% available stable funding factor:

(a) the Common Equity Tier 1 items of the institution before the adjustments required pursuant to Articles 32 to 35, the deductions pursuant to Article 36 and the application of the exemptions and alternatives laid down in Articles 48, 49 and 79;

(b) the Additional Tier 1 items of the institution before the deduction of the items referred to in Article 56 and before Article 79 has been applied thereto;

(c) the Tier 2 items of the institution before the deductions referred to in Article 66 and before the application of Article 79, having a residual maturity of one year or more, excluding any instruments with explicit or embedded options that, if exercised, would reduce the expected maturity to less than one year;

(d) any other capital instruments of the institution with a residual maturity of one year or more, excluding any instruments with explicit or embedded options that, if exercised, would reduce the expected maturity to less than one year;

(e) any other secured and unsecured borrowings and liabilities with a residual maturity of one year or more, including term deposits, unless otherwise specified in Articles 428aj to 428al.

(sNSFR)

Or. en

Amendment 868Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 g (new)

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Regulation (EU) No 575/2013Part 6 – Title IV – Chapter 4 b (new) – Article 428 a n (new)

Text proposed by the Commission Amendment

(114 g)In Part 6, Title IV, the following Chapter 4b is added:

"CHAPTER 4b

Required stable refinancing for the simplified calculation of the net stable funding ratio

SECTION 1

GENERAL PROVISIONS

Article 428an

Simplified calculation of the amount of required stable funding

1. By derogation from Chapter 4 and unless otherwise specified in this Chapter, for small and non-complex institutions the amount of required stable funding shall be calculated by multiplying the accounting value of various categories or types of assets and off-balance sheet items by the appropriate required stable funding factors to be applied in accordance with Section

2. The total amount of required stable funding shall be the sum of the weighted amounts of assets and off-balance sheet items. 2. Assets that institutions have borrowed, including in secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3), that are accounted for in their balance sheet and on which they do not have beneficial ownership shall be excluded from the calculation of the amount of required stable funding.

3. Assets that institutions have lent, including in secured lending transactions and capital market driven transactions, that remain on their balance sheet and over which they retain beneficial ownership, shall be considered as encumbered assets for the purposes of this

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Chapter and shall be subject to appropriate required stable funding factors to be applied under Section 2 of this Chapter. Otherwise, these assets shall be excluded from the calculation of the amount of required stable funding.

4. The following assets shall be considered to be unencumbered:

(a) assets included in a pool which are available for immediate use as collateral to obtain additional funding under committed or, where the pool is operated by a central bank, uncommitted but not yet funded credit lines available to the institution. Those assets shall include assets placed by a credit institution with the central institution in a cooperative network or institutional protection scheme. Institutions shall assume that assets in the pool are encumbered in order of increasing liquidity on the basis of the liquidity classification set out in Chapter 2 of Delegated Regulation (EU) 2015/61, starting with assets ineligible for the liquidity buffer;

(b) assets that the institution has received as collateral for credit risk mitigation purposes in secured lending, secured funding or collateral exchange transactions and that the institution may dispose of;

(c) assets attached as non-mandatory over-collateralisation to a covered bond issuance.

5. Institutions shall exclude assets associated with collateral recognised as variation margins posted in accordance with point (b) of Articles 428k(3) and 428ag(3) or as initial margins posted or as contributions to the default fund of a CCP in accordance with points (a) and (b) of Article 428af from other parts of calculation of the amount of required stable funding in accordance with this Chapter in order to avoid any double-counting.

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6. Institutions shall include in the calculation of the amount of required stable funding financial instruments, foreign currencies and commodities for which a purchase order has been executed. They shall exclude from the calculation of the amount of required stable funding financial instruments, foreign currencies and commodities for which a sale order has been executed, provided that those transactions are not reflected as derivatives or secured funding transactions in the institutions' balance sheet and that these transactions will be reflected in the institutions' balance sheet when settled.

7. Competent authorities may determine required stable funding factors to be applied to off-balance sheet exposures that are not referred to in this Chapter to ensure that institutions hold an appropriate amount of available stable funding for the portion of those exposures that are expected to require funding within the one-year horizon of the net stable funding ratio. To determine those factors, competent authorities shall in particular take into account material reputational damage for the institution that could result from not providing that funding.

Competent authorities shall report to EBA the types of off-balance sheet exposures for which they have determined required stable funding factors at least once a year. They shall include in that report an explanation of the methodology applied to determine those factors."

(sNSFR)

Or. en

Amendment 869Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 h (new)

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Regulation (EU) No 575/2013Article 428 a o (new)

Text proposed by the Commission Amendment

Article 428ao

Residual maturity of an asset

1. Unless otherwise specified in this Chapter, institutions shall take into account the residual contractual maturity of their assets and off-balance sheet transactions when determining the appropriate required stable funding factors to be applied to their assets and off-balance sheet items under Section 2 of this Chapter.

2. For assets that are encumbered, the maturity used to determine the appropriate required stable funding factors to be applied under Section 2 of this Chapter shall be either the residual maturity of the asset or the maturity of the transaction being the source of encumbrance, whichever is the longest. An asset that has less than six months remaining in the encumbrance period shall be subject to the required stable funding factor to be applied under Section 2 of this Chapter to the same asset held unencumbered.

3. Where an institution re-uses or re-pledges an asset that was borrowed, including in secured lending transactions and capital market-driven transactions as defined in Article 192(2) and (3), and that is accounted for off balance sheet, the residual maturity of the transaction through which that asset has been borrowed and which is used to determine the required stable funding factor to be applied under Section 2 of this Chapter, shall be the residual maturity of the transaction through which the asset is re-used or re-pledged.

4. Institutions shall treat assets that have been segregated in accordance with Article 11(3) of Regulation (EU) No

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648/2012 in accordance with their underlying exposure. Institutions shall however subject those assets to higher required stable funding factors depending on the term of encumbrance to be determined by competent authorities, who shall consider whether the institution can freely dispose or exchange such assets and the term of the liabilities to the institutions’ customers that generate this segregation requirement.

5. When calculating the residual maturity of an asset, institutions shall take options into account, based on the assumption that the issuer will exercise any option to extend maturity. For options exercisable at the discretion of the institution, the institution and competent authorities shall take into account reputational factors that may limit the institution’s ability not to exercise the option, in particular considering markets’ and clients’ expectations that the institution should extend certain assets at their maturity date.

(sNSFR)

Or. en

Amendment 870Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 i (new)Regulation (EU) No 575/2013Article 428 a p (new)

Text proposed by the Commission Amendment

SECTION 2

REQUIRED STABLE FUNDING FACTORS

Article 428ap

0% required stable funding factor

The following assets shall be subject to a 0% required stable funding factor:

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(a) unencumbered assets eligible as Level 1 high quality liquid assets in accordance with Article 10 of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation, regardless of their compliance with the operational requirements as set out in Article 8 of that Delegated Regulation;

(b) all central bank reserves, held in the ECB or in the central bank of a Member State or of a third country, including required reserves and excess reserves;

(c) all claims on the ECB, the central bank of a Member State or of a third country with a residual maturity of less than one year;

(d) assets that are categorised as interdependent with liabilities in accordance with Article 428f.

(sNSFR)

Or. en

Amendment 871Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 j (new)Regulation (EU) No 575/2013Article 428 a q (new)

Text proposed by the Commission Amendment

Article 428aq

5% required stable funding factor

The undrawn portion of irrevocable and conditionally revocable committed credit and liquidity facilities as they are referred to in Article 31(1) of Delegated Regulation (EU) 2015/61 receive a required stable funding factor of 5%.

(sNSFR)

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Or. en

Amendment 872Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 k (new)Regulation (EU) No 575/2013Article 428 a r (new)

Text proposed by the Commission Amendment

Article 428ar

10% required stable funding factor

1. Unencumbered assets eligible as Level 1 extremely high quality covered bonds in accordance with point (f) of Article 10(1) of Delegated Regulation(EU) 2015/61 shall be subject to a 10% required stable funding factor, regardless of their compliance with the operational requirements and with the requirements on the composition of the liquidity buffer as set out in Articles8 and 17 of that Delegated Regulation

2. For all netting sets of derivative contracts that are not subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 10% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

(sNSFR (supporting the EP draft report with one deviation based on input received from Deutscher Sparkassen- und Giroverband (DSGV): Unencumbered assets eligible as Level 1 extremely high quality covered bonds are added to the 10% RSF category which is more conservatively calibrated than the 7% as required by Basel).)

Or. en

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Amendment 873Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 l (new)Regulation (EU) No 575/2013Article 428 a s (new)

Text proposed by the Commission Amendment

Article 428as

15% required stable funding factor

The following assets and off-balance sheet items shall be subject to a 15% required stable funding factor:

(a) unencumbered assets eligible as Level 2A assets in accordance Article 11 of Delegated Regulation (EU) 2015/61, and unencumbered shares or units in CIUs in accordance with point (a) to (d) of Article 15(2) of Delegated Regulation (EU) 2015/61, regardless of their compliance with the operational requirements and with the requirements on the composition of the liquidity buffer as set out in Articles 8 and 17 of that Delegated Regulation;

(b) trade finance off-balance sheet related products as referred to in Article 111(1) of this Regulation and trade finance on-balance sheet related products, with a residual maturity of less than one year.

(sNSFR)

Or. en

Amendment 874Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 m (new)Regulation (EU) No 575/2013Article 428 a t (new)

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Text proposed by the Commission Amendment

Article 428at

20% required stable funding factor

The following assets shall be subject to a 20% required stable funding factor:

For all netting sets of derivative contracts subject to margin agreements under which institutions post variation margins to their counterparties, institutions shall apply a 20% required stable funding factor to the absolute market value of those netting sets of derivative contracts, gross of any collateral posted, where those netting sets have a negative market value.

(sNSFR)

Or. en

Amendment 875Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 n (new)Regulation (EU) No 575/2013Article 428 a u (new)

Text proposed by the Commission Amendment

Article 428au

50% required stable funding factor

The following assets shall be subject to a 50% required stable funding factor:

(a) Secured and unsecured loans with a residual maturity of less than one year and provided that they are encumbered less than one year,

(b) Assets eligible as Level 2B assets in accordance Article 12 of Delegated Regulation (EU) 2015/61, and shares or units in CIUs in accordance with point (e) to (h) of Article 15(2) of Delegated Regulation (EU) 2015/61, regardless of their compliance with the operational requirements and with the requirements

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on the composition of the liquidity buffer as set out in Articles 8 and 17 of that Delegated Regulation, provided that they are encumbered less than one year,

(c) any other assets with a residual maturity of less than one year, unless otherwise specified in Articles 428ap to 428at of this Regulation.

(sNSFR)

Or. en

Amendment 876Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 o (new)Regulation (EU) No 575/2013Article 428 a v (new)

Text proposed by the Commission Amendment

Article 428av

85% required stable funding factor

The following assets shall be subject to a 85% required stable funding factor:

(a) any assets, including cash, posted as initial margin for derivatives contracts.

(b) unencumbered loans with a residual maturity of one year or more, excluding loans to financial customers, which are not past due for more than 90 days

(c) trade finance on-balance sheet related products, with a residual maturity of one year or more;

(d) unencumbered securities with a residual maturity of one year or more that are not in default in accordance with Article 178 and that are not eligible as liquid assets in accordance with Articles 10 to 13 of Delegated Regulation (EU) 2015/61;

(e) unencumbered exchange-traded equities that are not eligible as Level 2B

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assets in accordance with Article 12 of Delegated Regulation (EU) 2015/61;

(f) physical traded commodities, including gold but excluding commodity derivatives.

(sNSFR)

Or. en

Amendment 877Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 114 p (new)Regulation (EU) No 575/2013Article 428 a w (new)

Text proposed by the Commission Amendment

Article 428aw

100% required stable funding factor

1. The following assets shall be subject to a 100% required stable funding factor:

(a) any assets encumbered for a residual maturity of one year or more;

(b) any assets other than those referred to in Articles 428ap to 428av, including loans to financial customers having a residual contractual maturity of one year or more, non-performing loans, items deducted from regulatory capital, fixed assets, non-exchange traded equities, retained interest, insurance assets, defaulted securities.

2. By the way of a derogation from point (a) of paragraph 1, assets that are encumbered for one year or more for non-standard, temporary operations conducted by the ECB or the central bank of a Member State in order to achieve its mandate in a period of market-wide financial stress or exceptional macroeconomic challenges, may receive a reduced required stable funding factor. Competent authorities shall determine,

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with the approval of the relevant central bank, the appropriate required stable funding factor to be applied to those encumbered assets, which shall not be lower than the required stable funding factor that would apply to those assets if they were held unencumbered under this Section.

3. Institutions shall apply a 100% required stable funding factor to the difference, if positive, between the sum of market values across all netting sets with positive market value and the sum of market values across all netting sets with negative market value calculated in accordance with Article 428d.

The following rules shall apply to the calculation referred to in the first subparagraph:

(a) variation margins received by institutions from their counterparties shall be deducted from the market value of a netting set with positive market value where the collateral received as variation margins qualifies as Level 1 assets in accordance with Title II of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation, and that institutions would be legally entitled and operationally able to reuse;

(b) all variation margin posted by institutions to their counterparties shall be deducted from the market value of a netting set with negative market value.

(sNSFR)

Or. en

Amendment 878Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 – paragraph 3

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Text proposed by the Commission Amendment

3. For the purposes of paragraph 2, the capital measure shall be the Tier 1 capital.

3. For the purposes of paragraph 2, the capital measure shall be the Tier 1 capital, comprising Common Equity Tier 1 and/or Additional Tier 1 instruments.

Or. en

Justification

In line with the BCBS standard, the capital measure of the LR shall be Tier 1 capital, comprising CET 1 and/or AT 1 instruments. In line with the EBA report on the LR requirements under CRR Art. 511 (p. 52) there does not seem to be an obvious rationale at this stage to be stricter than the Basel framework and applying a different definition of the capital measure for the LR would complicate the overall regulatory framework, while there is certainly merit in maintaining consistency/simplicity.

Amendment 879Sven Giegold, Philippe Lamberts, Ernest UrtasunProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 – paragraph 3

Text proposed by the Commission Amendment

3. For the purposes of paragraph 2, the capital measure shall be the Tier 1 capital.

3. For the purposes of paragraph 2, the capital measure shall be the Common Equity Tier 1 capital.

Or. en

Justification

CET1 represents the core shareholder equity and is a more appropriate numerator for the LR

Amendment 880Ashley FoxProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 – paragraphs 4 a, 4 b, 4 c, 4 d (new)

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Text proposed by the Commission Amendment

4a. By way of derogation from point (a) of Article 429(4), competent authorities may require institutions to exclude from the leverage ratio exposure measure all current and future, or all future, exposures to central banks.

4b. For the purpose of paragraph1a, exposures to central banks means exposures of an institution that are denominated in the domestic or regional currency of that central bank and that fall under one of the categories in points (i), (ii) or (iii):

(i) coins or banknotes;

(ii) reserves held by the institution in the central bank; and

(iii) assets representing debt claims on the central bank with an initial maturity not exceeding 3 months.

4c. Where an institution is required to exclude exposures in accordance with paragraph 1a it shall do so up to an amount that does not exceed the total amount of deposits taken by the institution, where both the following conditions are met:

(a) the deposits and the exposures are denominated in the same currency; and

(b) the contractual maturity of the exposures does not exceed the contractual maturity of the deposits.

4d. When exposures are excluded in accordance with this Article, the requirement set out in Article92 (1)(d) shall be adjusted commensurately to offset the impact of exempting central bank reserves.

Or. en

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Amendment 881Ashley FoxProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 – paragraph 5 – point a

Text proposed by the Commission Amendment

(a) a derivative instrument that is considered an off-balance sheet item in accordance with point (d) of paragraph 4 but is treated as a derivative in accordance with the applicable accounting framework, shall be subject to the treatment set out in point (b) of paragraph 4;

(a) a derivative instrument that is considered an off-balance sheet item in accordance with point (d) of paragraph 4 but is treated as a derivative in accordance with the applicable accounting framework, shall be subject to the treatment set out in Article 429f;

Or. en

Amendment 882Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 1 – introductory part

Text proposed by the Commission Amendment

1. By way of derogation from point (a) of Article 429(4), an institution may exclude any of the following exposures from its exposure measure :

1. By way of derogation from Article 429(4), an institution may exclude any of the following exposures from its exposure measure :

Or. en

Justification

This amendment aims at extend the scope of exclusion in line with article 429 and the different exposure value.

Amendment 883Herbert DorfmannProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 1 – point c

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Text proposed by the Commission Amendment

(c) exposures that are assigned a risk weight of 0% in accordance with Article 113(6);

(c) exposures that are assigned a risk weight of 0% in accordance with Article 113(6) or 113(7);

Or. en

Amendment 884Markus FerberProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 1 – point c

Text proposed by the Commission Amendment

(c) exposures that are assigned a risk weight of 0% in accordance with Article 113(6);

(c) exposures that are assigned a risk weight of 0% in accordance with Article 113(6) and (7);

Or. de

Justification

The possibility of exemption should also apply to exposures between members of the same institutional guarantee system.

Amendment 885Herbert DorfmannProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 1 – point c a (new)

Text proposed by the Commission Amendment

(ca) exposures, including participations or other kinds of holdings, incurred by an institution to its parent undertaking, too other subsidiaries of that parent undertaking or to its own subsidiaries, in so far as those undertakings are covered by the supervision on a consolidated basis to which the institution itself is subject, in

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accordance with this Regulation;

Or. en

Amendment 886Pervenche BerèsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 1 – point d

Text proposed by the Commission Amendment

(d) where the institution is a public development credit institution, the exposures arising from assets that constitute claims on regional governments, local authorities or public sector entities in relation to public sector investments;

(d) where the institution is a public development credit institution, the exposures arising from assets that constitute claims on regional governments, local authorities or public sector entities in relation to public sector investments or, where the institution complies with points(a),(b),(c),(e) of paragraph 2 of this article and operates at a domestic level, with a form of government oversight, exposures to credit institutions collateralized by residential housing assets;

Or. en

Amendment 887Markus FerberProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 1 – point d

Text proposed by the Commission Amendment

(d) where the institution is a public development credit institution, the exposures arising from assets that constitute claims on regional governments, local authorities or public sector entities in relation to public sector investments;

(d) where the institution is a public development credit institution, the exposures arising from assets that constitute direct or indirect claims on regional governments, local authorities or public sector entities in relation to public sector investments;

Or. de

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Justification

The definition should also cover indirect claims (for example by means of guarantees).

Amendment 888Caroline NagtegaalProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 1 – point d

Text proposed by the Commission Amendment

(d) where the institution is a public development credit institution, the exposures arising from assets that constitute claims on regional governments, local authorities or public sector entities in relation to public sector investments;

(d) where the institution is a public development credit institution, the exposures arising from assets that constitute claims on central governments, regional governments, local authorities or public sector entities in relation to public sector investments;

Or. en

Amendment 889Markus FerberProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 1 – point e

Text proposed by the Commission Amendment

(e) exposures arising from passing-through promotional loans to other credit institutions granting the promotional loan;

(e) exposures arising from promotional loans;

Or. de

Justification

The exemption for promotional loans should apply not only to promotional banks but to all institutions which grant such loans.

Amendment 890Peter Simon

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Proposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 1 – point f – point i

Text proposed by the Commission Amendment

(i) ,the guarantee is provided by an export credit agency or by a central government;

(i) the guarantee is provided by an eligible provider of unfunded credit protection in accordance with Articles 201 and 202, including export credit agencies or central governments;

Or. en

Justification

In order to include guaranteed parts of export credits from credit insurance insurers, this amendment is necessary.

Amendment 891Othmar KarasProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 1 – point m a (new)

Text proposed by the Commission Amendment

(ma) For exposures comprised of combined product elements, which are designed so that a balance is assigned to the institution without dispute or conditions, and can be offset at any time with the claim from the intermediate loan, the sum that is greater than the netted exposure value.

Or. de

Justification

In the case of pre-intermediate financing by building savings institutions, payments of principal increase the building savings institution balance, leave the exposure value of the building savings institution unchanged and increase the balance volumes, although the balance can be offset with the exposure value if necessary. In the case of regular loans, the repayment leads to the reduction of the exposure value and the balance sheet volume. For this

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reason, offsetting the savings deposit with the savings contract should be enabled with the calculation of the leverage ratio.

Amendment 892Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 1 – point m a (new)

Text proposed by the Commission Amendment

(ma) cash and central banks deposits

Or. en

Justification

The Basel Committee has recognised the need to potentially exempt central bank reserves from the LR. Also the Bank of England underlined in a publication on 27 January 2017 that the inclusion in the LR of central bank cash can "affect the ability of the banking system to cushion shocks and to draw on central bank liquidity facilities, as necessary, to maintain the supply of credit and support for market functioning"

Amendment 893Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 1 – point m b (new)

Text proposed by the Commission Amendment

(mb) the Initial Margin posted in segregated accounts

Or. en

Justification

The amendment aims to exclude internal margins posted under segregation for both cleared and non-cleared (OTC) as there is the risk of having a double exposure between balance sheet and Potential Future Exposure used under the Standardised Approach for Counterparty Credit risk (SA-CCR)

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Amendment 894Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 1 – point m c (new)

Text proposed by the Commission Amendment

(mc) Underlying assets of leasing contracts that are classified as an operating lease where the institution is the lessee

Or. en

Justification

Under the current leasing standard (IAS 17) lease contracts are recognized on balance only when the contract transfers substantially all the risks and rewards incident to ownership to the lessee (finance lease). Operating leases therefore had no impact on the balance sheet of the lessee. IFRS 16 (effective 01.01.2019) introduces fundamental changes in accounting for operating Lease contracts on lessee`s balance sheet as it no longer differentiates between operating and finance lease and requires to recognize all leases on the balance sheet as Right of Use Assets (RoU).

The IASB´s decision to no longer refer to the level of risk being transferred between the lessor and the lessee is not considered an adequate basis for the prudential treatment. For institutions that rent property and equipment (currently classified as operating lease), these changes will negatively impact:

Capital ratio (assuming the RoU-Asset would be assigned to other non-credit-obligation assets with a RW of 100%);

Leverage ratio (due to an increase of the balance sheet total);

Net stable funding ratio (due to an increase in the required stable funding).

The risk distribution between the lessee and the lessor shall be taken into account for regulatory purposes (for RWA and LR) to achieve a risk adequate, appropriate and proportionate treatment.

The proposed changes will achieve an adequate treatment of leases for leverage ratio.

Amendment 895Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 115

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Regulation (EU) No 575/2013Article 429 a – paragraph 2 – introductory part

Text proposed by the Commission Amendment

2. For the purposes of point (d) of paragraph 1, public development credit institution means a credit institution that meets all of the following conditions:

2. For the purposes of point (d) of paragraph 1, public development credit institution means a credit institution that meets all of the following conditions or is qualified as a promotional or development bank by a European Commission decision:

Or. en

Justification

This amendment aims to correct the text of the Commission on the definition of promotional banks in the context of the LR in order to ensure that a greater variety of public development banks in Europe are covered by the derogation foreseen under article 429a paragraph 1 point (d)

Amendment 896Markus FerberProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – introductory part

Text proposed by the Commission Amendment

2. For the purposes of point (d) of paragraph 1, public development credit institution means a credit institution that meets all of the following conditions:

2. For the purposes of point (d) of paragraph 1, public development credit institution means a credit institution or a facility associated with a credit institution that meets all of the following conditions:

Or. de

Amendment 897Thomas MannProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – introductory part

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Text proposed by the Commission Amendment

2. For the purposes of point (d) of paragraph 1, public development credit institution means a credit institution that meets all of the following conditions:

2. For the purposes of point (d) of paragraph 1, public development credit institution means a credit institution or a unit of a credit institution that meets all of the following conditions:

Or. de

Amendment 898Pervenche BerèsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – point a

Text proposed by the Commission Amendment

(a) it has been established under public law by a Member State's central government, regional government or local authority;

(a) it has been established under public law by a Member State's central government, regional government or local authority or is considered as a development or a promotional bank in accordance with a Commission's decision;

Or. en

Amendment 899Esther de LangeProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – point a

Text proposed by the Commission Amendment

(a) it has been established under public law by a Member State's central government, regional government or local authority;

(a) it has been established by a Member State's central government, regional government or local authority;

Or. en

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Amendment 900Pervenche BerèsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – point b

Text proposed by the Commission Amendment

(b) its activity is limited to advancing specified objectives of financial, social or economic public policy in accordance with the laws and provisions governing that institution, on a non-competitive basis. For these purposes, public policy objectives may include the provision of financing for promotional or development purposes to specified economic sectors or geographical areas of the relevant Member State;

(b) its activity is limited to advancing specified objectives of financial, social or economic public policy in accordance with the laws and provisions governing that institution, on a non-competitive basis, or to address a market failure. For these purposes, public policy objectives may include the provision of financing for promotional or development purposes to specified economic sectors or geographical areas of the relevant Member State;

Or. en

Amendment 901Anne Sander, Alain Cadec, Alain LamassoureProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – point b

Text proposed by the Commission Amendment

(b) its activity is limited to advancing specified objectives of financial, social or economic public policy in accordance with the laws and provisions governing that institution, on a non-competitive basis. For these purposes, public policy objectives may include the provision of financing for promotional or development purposes to specified economic sectors or geographical areas of the relevant Member State;

(b) its activity is limited to advancing specified objectives of financial, social or economic public policy in accordance with the laws and provisions governing that institution, on a non-competitive basis, or to address a market failure. For these purposes, public policy objectives may include the provision of financing for promotional or development purposes to specified economic sectors or geographical areas of the relevant Member State;

Or. en

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Justification

This amendment aims to correct the text of the Commission on the definition of promotional banks in the context of the LR in order to ensure that a greater variety of public development banks in Europe are covered by the derogation foreseen under article 429a paragraph 1 point (d)

Amendment 902Esther de LangeProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – point d

Text proposed by the Commission Amendment

(d) subject to state aid rules, the central government, regional government or local authority has an obligation to protect the credit institution's viability or directly or indirectly guarantees at least 90% of the credit institution's own funds requirements, funding requirements or exposures;

(d) subject to state aid rules, the central government, regional government or local authority has an obligation to protect the credit institution's viability or directly or indirectly guarantees at least 90% of the credit institution's own funds requirements, funding requirements or promotional loans granted;

Or. en

Amendment 903Caroline NagtegaalProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – point d

Text proposed by the Commission Amendment

(d) subject to state aid rules, the central government, regional government or local authority has an obligation to protect the credit institution's viability or directly or indirectly guarantees at least 90% of the credit institution's own funds requirements, funding requirements or exposures;

(d) subject to state aid rules, the central government, regional government or local authority has an obligation to protect the credit institution's viability or directly or indirectly guarantees at least 90% of the credit institution's own funds requirements, funding requirements or promotional loans granted;

Or. en

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Amendment 904Matt Carthy, Martin SchirdewanProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – point e

Text proposed by the Commission Amendment

(e) it is precluded from accepting covered deposits as defined in point (5) of Article 2(1) of Directive 2014/49/EU or in the national law of Member States implementing that Directive.

deleted

Or. en

Amendment 905Markus FerberProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – point e

Text proposed by the Commission Amendment

(e) it is precluded from accepting covered deposits as defined in point (5) of Article 2(1) of Directive 2014/49/EU or in the national law of Member States implementing that Directive.

(e) it shall not directly receive private individuals’ savings deposits;

Or. de

Amendment 906Esther de LangeProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – point e

Text proposed by the Commission Amendment

(e) it is precluded from accepting covered deposits as defined in point (5) of Article 2(1) of Directive 2014/49/EU or in the national law of Member States

(e) it is not a direct recipient of savings from private pensions.

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implementing that Directive.

Or. en

Amendment 907Thomas MannProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – point e

Text proposed by the Commission Amendment

(e) it is precluded from accepting covered deposits as defined in point (5) of Article 2(1) of Directive 2014/49/EU or in the national law of Member States implementing that Directive.

(e) it is not a direct recipient of private individuals’ savings deposits;

Or. de

Amendment 908Anne Sander, Alain Lamassoure, Alain CadecProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – point e

Text proposed by the Commission Amendment

(e) it is precluded from accepting covered deposits as defined in point (5) of Article 2(1) of Directive 2014/49/EU or in the national law of Member States implementing that Directive.

(e) it does not take covered deposits as defined in point (5) of Article 2(1) of Directive 2014/49/EU or in the national law of Member States implementing that Directive.

Or. en

Justification

This amendments aims to correct the text of the Commission on the definition of promotional banks in the context of the LR in order to ensure that a greater variety of public development banks in Europe are covered by the derogation foreseen under article 429a paragraph 1 point (d)

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Amendment 909Pervenche BerèsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – point e

Text proposed by the Commission Amendment

(e) it is precluded from accepting covered deposits as defined in point (5) of Article 2(1) of Directive 2014/49/EU or in the national law of Member States implementing that Directive.

(e) it does not take covered deposits as defined in point (5) of Article 2(1) of Directive 2014/49/EU or in the national law of Member States implementing that Directive.

Or. en

Amendment 910Caroline NagtegaalProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 a – paragraph 2 – point e a (new)

Text proposed by the Commission Amendment

(ea) At least 90% of the promotional loans are granted by the institution to central governments, regional governments, local authorities or entities providing public services. If the loan is provided to an entity providing public services the loan needs to be guaranteed by a central or regional government or a local authority.

Or. en

Justification

This makes sure only exposures from public banks that grant promotional loans to public entities are excluded. These promotional loans to public entities are relatively riskless.

Amendment 911Sven Giegold, Ernest Urtasun, Philippe Lamberts

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Proposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 b – paragraph 4

Text proposed by the Commission Amendment

4. By way of derogation from point (d) of paragraph 1, institutions may calculate the exposure value of cash receivable and cash payable under an SFT with the same counterparty on a net basis only where all the following conditions are met:

deleted

(a) the transactions have the same explicit final settlement date;

(b) the right to set off the amount owed to the counterparty with the amount owed by the counterparty is legally enforceable in all of the following situations:

(i) in the normal course of business;

(ii) in the event of default, insolvency and bankruptcy;

(c) the counterparties intend to settle on a net basis, to settle simultaneously, or the transactions are subject to a settlement mechanism that results in the functional equivalent of net settlement.

Or. en

Justification

This regulatory treatment is prudent and has the additional benefit of avoiding inconsistencies from netting which may arise across different accounting regimes.

Amendment 912Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 b – paragraph 5

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Text proposed by the Commission Amendment

5. For the purposes of point (c) of paragraph 4, institutions may conclude that a settlement mechanism results in the functional equivalent of net settlement only where, on the settlement date, the net result of the cash flows of the transactions under that mechanism is equal to the single net amount under net settlement and all of the following conditions are met:

deleted

(a) the transactions are settled through the same settlement system;

(b) the settlement arrangements are supported by cash or intraday credit facilities intended to ensure that the settlement of the transactions will occur by the end of the business day;

(c) any issues arising from the securities legs of the SFTs do not interfere with the completion of the net settlement of the cash receivables and payables.

The condition in point (c) of the first subparagraph is met only where the failure of any SFT in the settlement mechanism may delay settlement of only the matching cash leg or may create an obligation to the settlement mechanism, supported by an associated credit facility.

Where there is a failure of the securities leg of an SFT in the settlement mechanism at the end of the window for settlement in the settlement mechanism, institutions shall split out this transaction and its matching cash leg from the netting set and treat them on a gross basis.

Or. en

Amendment 913Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 115

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Regulation (EU) No 575/2013Article 429 c – paragraph 3 – introductory part

Text proposed by the Commission Amendment

3. For the purposes of paragraph 1 of this Article, institutions calculating the replacement cost of derivative contracts in accordance with Article 275 may recognise only collateral received in cash from their counterparties as the variation margin referred to in Article 275, where the applicable accounting framework has not already recognised the variation margin as a reduction of the exposure value and where all of the following conditions are met:

3. For the purposes of paragraph 1 of this Article, institutions calculating the replacement cost of derivative contracts in accordance with Article 275 may recognise only collateral received that qualifies as Level 1 high quality liquid assets in accordance with Article 10 of Delegated Regulation (EU) 2015/61, excluding extremely high quality covered bonds referred to in point (f) of Article 10(1) of that Delegated Regulation, regardless of their compliance with the operational requirements as set out in Article 8 of that Delegated Regulation from their counterparties as the variation margin referred to in Article 275, where the applicable accounting framework has not already recognised the variation margin as a reduction of the exposure value and where all of the following conditions are met:

Or. en

Justification

Allows for the use of Level1HQLA and cash as collateral.

Amendment 914Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 3 – introductory part

Text proposed by the Commission Amendment

3. For the purposes of paragraph 1 of this Article, institutions calculating the replacement cost of derivative contracts in accordance with Article 275 may recognise only collateral received in cash from their

3. For the purposes of paragraph 1 of this Article, institutions calculating the replacement cost of derivative contracts in accordance with Article 275 shall not recognise collateral received in cash from

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counterparties as the variation margin referred to in Article 275, where the applicable accounting framework has not already recognised the variation margin as a reduction of the exposure value and where all of the following conditions are met:

their counterparties as the variation margin referred to in Article 275, whether or not netting is permitted under the applicable accounting framework:

Or. en

Amendment 915Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 3 – point a

Text proposed by the Commission Amendment

(a) for trades not cleared through a QCCP, the cash received by the recipient counterparty is not segregated;

deleted

Or. en

Amendment 916Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 3 – point a

Text proposed by the Commission Amendment

(a) for trades not cleared through a QCCP, the cash received by the recipient counterparty is not segregated;

(a) for trades not cleared through a QCCP, the Level 1 high quality liquid asset received as collateral by the recipient counterparty is not segregated;

Or. en

Justification

Allows for the use of Level1HQLA and cash as collateral.

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Amendment 917Sven GiegoldProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 3 – point b

Text proposed by the Commission Amendment

(b) the variation margin is calculated and exchanged at least daily based on a mark-to-market valuation of derivatives positions;

deleted

Or. en

Amendment 918Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 3 – point c

Text proposed by the Commission Amendment

(c) the variation margin received is in a currency specified in the derivative contract, governing master netting agreement, credit support annex to the qualifying master netting agreement or as defined by any netting agreement with a QCCP;

deleted

Or. en

Amendment 919Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 3 – point d

Text proposed by the Commission Amendment

(d) the variation margin received is the full amount that would be necessary to extinguish the mark-to-market exposure

deleted

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of the derivative contract subject to the threshold and minimum transfer amounts that are applicable to the counterparty;

Or. en

Amendment 920Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 3 – point e

Text proposed by the Commission Amendment

(e) the derivative contract and the variation margin between the institution and the counterparty to that contract are covered by a single netting agreement that the institution may treat as risk-reducing in accordance with Article 295.

deleted

Or. en

Amendment 921Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 3 – subparagraph 2

Text proposed by the Commission Amendment

For the purposes of the first subparagraph, where an institution provides cash collateral to a counterparty and that collateral meets the conditions laid down in points (a) to (e) of that subparagraph, the institution shall consider that collateral as the variation margin posted to the counterparty and shall include it in the calculation of replacement cost.

deleted

Or. en

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Amendment 922Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 3 – subparagraph 2

Text proposed by the Commission Amendment

For the purposes of the first subparagraph, where an institution provides cash collateral to a counterparty and that collateral meets the conditions laid down in points (a) to (e) of that subparagraph, the institution shall consider that collateral as the variation margin posted to the counterparty and shall include it in the calculation of replacement cost.

For the purposes of the first subparagraph, where an institution provides collateral as referred to under paragraph 3 to a counterparty and that collateral meets the conditions laid down in points (a) to (e) of that subparagraph, the institution shall consider that collateral as the variation margin posted to the counterparty and shall include it in the calculation of replacement cost.

Or. en

Justification

Allows for the use of Level1HQLA and cash as collateral.

Amendment 923Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 3 – subparagraph 3

Text proposed by the Commission Amendment

For the purposes of point (b) of the first subparagraph, an institution shall be considered to have met the condition therein where the variation margin is exchanged on the morning of the trading day following the trading day on which the derivative contract was stipulated, provided that the exchange is based on the value of the contract at the end of the trading day on which the contract was stipulated.

deleted

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Or. en

Amendment 924Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 3 – subparagraph 4

Text proposed by the Commission Amendment

For the purposes of point (d) of the first subparagraph, where a margin dispute arises, institutions may recognise the amount of non-disputed collateral that has been exchanged.

deleted

Or. en

Amendment 925Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 115 (new)Regulation (EU) No 575/2013Article 429 c – paragraph 3 a (new)

Text proposed by the Commission Amendment

3a. Where any collateral amount received reduces the amount of derivatives assets under the applicable accounting framework, institutions shall reverse that reduction.

Or. en

Amendment 926Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 4

Text proposed by the Commission Amendment

4. For the purposes of paragraph 1 deleted

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of this Article, institutions shall not include collateral received in the calculation of NICA as defined in point 12a of Article 272, except in the case of derivatives contracts with clients where those contracts are cleared by a QCCP.

Or. en

Amendment 927Marco ValliProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 4

Text proposed by the Commission Amendment

4. For the purposes of paragraph 1 of this Article, institutions shall not include collateral received in the calculation of NICA as defined in point 12a of Article 272, except in the case of derivatives contracts with clients where those contracts are cleared by a QCCP.

deleted

Or. en

Justification

Deletion of exclusion of initial margins on derivatives from the LR denominator.

Amendment 928Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 4

Text proposed by the Commission Amendment

4. For the purposes of paragraph 1 of this Article, institutions shall not include collateral received in the calculation of NICA as defined in point 12a of Article 272, except in the case of derivatives

4. For the purposes of paragraph 1 of this Article, institutions shall not include collateral received in the calculation of NICA as defined in point 12a of Article 272, except in the case of derivatives

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contracts with clients where those contracts are cleared by a QCCP.

contracts with counterparties referred to under point (10) of Article 2 of Regulation (EU) No 648/2012 or with clients where those contracts are cleared by a QCCP.

Or. en

Justification

Allows for the use of Level1HQLA and cash as collateral.

Amendment 929Anne Sander, Alain Lamassoure, Alain CadecProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 4

Text proposed by the Commission Amendment

4. For the purposes of paragraph 1 of this Article, institutions shall not include collateral received in the calculation of NICA as defined in point 12a of Article 272, except in the case of derivatives contracts with clients where those contracts are cleared by a QCCP.

4. For the purposes of paragraph 1 of this Article, institutions shall include collateral received in the calculation of NICA as defined in point 12a of Article 272.

Or. en

Justification

This amendment aims at extending the deduction of internal margins received from the clients for cleared transaction to non-cleared derivative. The idea here as well is to avoid double counting.

Amendment 930Matt Carthy, Martin SchirdewanProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 4

Text proposed by the Commission Amendment

4. For the purposes of paragraph 1 of 4. For the purposes of paragraph 1 of

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this Article, institutions shall not include collateral received in the calculation of NICA as defined in point 12a of Article 272, except in the case of derivatives contracts with clients where those contracts are cleared by a QCCP.

this Article, institutions shall not include collateral received in the calculation of NICA as defined in point 12a of Article 272.

Or. en

Amendment 931Caroline Nagtegaal, Thierry CornilletProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 5

Text proposed by the Commission Amendment

5. For the purposes of paragraph 1 of this Article, institutions shall set the value of the multiplier used in the calculation of the potential future exposure in accordance with Article 278(1) to one, except in the case of derivatives contracts with clients where those contracts are cleared by a QCCP.

5. For the purposes of paragraph 1 of this Article, institutions shall set the value of the multiplier used in the calculation of the potential future exposure in accordance with Article 278(1) to one, except in the case of derivatives contracts with counterparties referred to under point (10) of Article 2 of Regulation (EU) No 648/2012 or with clients where those contracts are cleared by a QCCP.

Or. en

Amendment 932Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 5

Text proposed by the Commission Amendment

5. For the purposes of paragraph 1 of this Article, institutions shall set the value of the multiplier used in the calculation of the potential future exposure in accordance with Article 278(1) to one, except in the case of derivatives contracts with clients where those contracts are cleared by a

5. For the purposes of paragraph 1 of this Article, institutions shall set the value of the multiplier used in the calculation of the potential future exposure in accordance with Article 278(1) to one.

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QCCP.

Or. en

Amendment 933Marco ValliProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 c – paragraph 5

Text proposed by the Commission Amendment

5. For the purposes of paragraph 1 of this Article, institutions shall set the value of the multiplier used in the calculation of the potential future exposure in accordance with Article 278(1) to one, except in the case of derivatives contracts with clients where those contracts are cleared by a QCCP.

5. For the purposes of paragraph 1 of this Article, institutions shall set the value of the multiplier used in the calculation of the potential future exposure in accordance with Article 278(1) to one.

Or. en

Amendment 934Peter SimonProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 g a (new)

Text proposed by the Commission Amendment

Article 429ga

Average exposure values for the purposes of reporting and disclosure for large institutions

(1) For the purposes of Articles 430 and 451, large institutions according to Article 4 paragraph 1 point 144b shall calculate:

(a) the sum of the total exposure values of the assets falling within Article 429(4)(a) as they stand on each day of the reporting period divided by the number of

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days in the reporting period;

(b) the sum of the total exposure values of the contracts falling within Article 429(4)(b) as they stand on the last day of each month in the reporting period divided by the total number of months in the reporting period;

(c) the sum of the total exposure values of the add-ons for counterparty credit risk of Securities Financing Transactions falling within Article 429(4)(c) as they stand on the last day of each month in the reporting period divided by the total number of months in the reporting period;

(d) the sum of the total exposure values of the regular-way purchases or sales falling within Article 429(4)e) as they stand on the last day of each month in the reporting period divided by the total number of months in the reporting period.

Or. en

Justification

Large institutions should report their average exposure values of the leverage ratio, in order to ensure that large institutions are not intentionally leveraging and deleveraging of the course of the reporting period. This will allow supervisory authorities to identify how institutions are meeting the leverage ratio requirement on an ongoing basis.

Amendment 935Sven Giegold, Ernest Urtasun, Philippe LambertsProposal for a regulationArticle 1 – paragraph 1 – point 115Regulation (EU) No 575/2013Article 429 g a (new)

Text proposed by the Commission Amendment

Article 429ga

Leverage exposure floor

The total leverage ratio exposure measure of an institution shall be no lower than its total assets disclosed in published

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financial statements.

Or. en

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