xmlns:atom="http://www.w3.org/2005/Atom" xmlns:atom="http://www.w3.org/2005/Atom"

[X1PART TWO U.K. [F1OWN FUNDS AND ELIGIBLE LIABILITIES]

TITLE I U.K. ELEMENTS OF OWN FUNDS

CHAPTER 6 U.K. [F1General requirements for own funds and eligible liabilities]

[F2 Article 78a U.K. Permission to reduce eligible liabilities instruments

1 . The resolution authority shall grant permission for an institution to call, redeem, repay or repurchase eligible liabilities instruments where one of the following conditions is met:

( a ) before or at the same time as any of the actions referred to in Article 77(2), the institution replaces the eligible liabilities instruments with own funds or eligible liabilities instruments of equal or higher quality at terms that are sustainable for the income capacity of the institution;

( b ) the institution has demonstrated to the satisfaction of the resolution authority that the own funds and eligible liabilities of the institution would, following the action referred to in Article 77(2) of this Regulation, exceed the requirements for own funds and eligible liabilities laid down in this Regulation and in [F3Directive 2013/36/EU UK law and in the United Kingdom legislation that implemented Directive 2014/59/EU as amended from time to time] by a margin that the resolution authority, in agreement with the competent authority, considers necessary;

( c ) the institution has demonstrated to the satisfaction of the resolution authority that the partial or full replacement of the eligible liabilities with own funds instruments is necessary to ensure compliance with the own funds requirements laid down in this Regulation and in [F4Directive 2013/36/EU UK law] for continuing authorisation.

Where an institution provides sufficient safeguards as to its capacity to operate with own funds and eligible liabilities above the amount of the requirements laid down in this Regulation and in [F3Directive 2013/36/EU UK law and in the United Kingdom legislation that implemented Directive 2014/59/EU as amended from time to time], the resolution authority, after consulting the competent authority, may grant that institution a general prior permission to effect calls, redemptions, repayments or repurchases of eligible liabilities instruments, subject to criteria that ensure that any such future action will be in accordance with the conditions set out in points (a) and (b) of this paragraph. That general prior permission shall be granted only for a specified period, which shall not exceed one year, after which it may be renewed. The general prior permission shall be granted for a certain predetermined amount, which shall be set by the resolution authority. [F5the resolution authority] shall inform the competent authorities about any general prior permission granted.

The resolution authority shall withdraw the general prior permission where an institution breaches any of the criteria provided for the purposes of that permission.

2 . When assessing the sustainability of the replacement instruments for the income capacity of the institution referred to in point (a) of paragraph 1, [F5the resolution authority] shall consider the extent to which those replacement capital instruments or replacement eligible liabilities would be more costly for the institution than those they would replace.

3 .[F6The Bank may make] technical standards to specify the following:

( a ) the process of cooperation between the competent authority and the resolution authority;

( b ) the procedure, including the time limits and information requirements, for granting the permission in accordance with the first subparagraph of paragraph 1;

( c ) the procedure, including the time limits and information requirements, for granting the general prior permission in accordance with the second subparagraph of paragraph 1;

( d ) the meaning of ‘ sustainable for the income capacity of the institution ’ .

For the purposes of point (d) of the first subparagraph of this paragraph, the F7... technical standards shall be fully aligned with the [F8technical standards] referred to in Article 78.

F9...]]

Textual Amendments

Editorial Information

Textual Amendments