Changes from plenary report to adopted text

Removed(5) ‘credit exposure’ means any on-balance sheet item, including any amount of principal, accrued interest and fees owed by the obligor to the institution, or any off-balance sheet item that results, or may result, in a credit obligation;

Removed(6) ‘facility’ means a credit exposure arising from a contract ▌between an obligor and an institution;

Removed(7) ‘margin of conservatism’ means an ▌add-on incorporated in risk estimates, adequate to account for the expected range of estimation errors stemming from identified deficiencies in data, methods, models, and changes to underwriting standards, risk appetite, collection and recovery policies and any other source of additional uncertainty, as well as from general estimation error;

Removed(8) ‘small and medium-sized enterprise’ or ‘SME’ means a company, enterprise or undertaking which, according to the last consolidated accounts, has an annual turnover not exceeding EUR 50 000 000;’

Removed(9) ‘commitment’ means any contractual arrangement that an institution offers to a client and is accepted by that client, to extend credit, purchase assets or issue credit substitutes. Any arrangement that can be unconditionally cancelled by the institution at any time without prior notice to the obligor or any arrangement that can be cancelled by the institution where the obligor fails to meet conditions set out in the facility documentation, including conditions that must be met by the obligor prior to any initial or subsequent drawdown under the arrangement, is a commitment;

RemovedContractual arrangements that meet all of the following conditions shall not be commitments:

Removed(a) contractual arrangements where the institution receives no fees or commissions to establish or maintain those contractual arrangements;

Removed(b) contractual arrangements where the client is required to apply to the institution for the initial and each subsequent drawdown under those contractual arrangements;

Removed(c) contractual arrangements where the institution has full authority, regardless of the fulfilment by the client of the conditions set out in the contractual arrangement documentation, over the execution of each drawdown;

Removed(d) contractual arrangements where the institution is required to assess the creditworthiness of the client immediately prior to deciding on the execution of each drawdown;

Removed(e) contractual arrangements that are offered to a corporate entity, including an SME, that is closely monitored on an ongoing basis.

Removed(10) ‘unconditionally cancellable commitment’ means any commitment the terms of which permit the institution to cancel that commitment to the full extent allowable under consumer protection and related legislation where applicable at any time without prior notice to the obligor or that effectively provide for automatic cancellation due to deterioration in a borrower's creditworthiness.’;

Removed(3) in Article 6, paragraph 3 is replaced by the following:

Removed‘3. No institution which is either a parent undertaking or a subsidiary, and no institution included in the consolidation pursuant to Article 18, shall be required to comply on an individual basis with the obligations laid down in Article 92, paragraphs 5 and 6, and Part Eight.’;

Removed(3a) in Article 7, the following paragraph is added:

Removed‘3a. By 31 December 2026, the Commission shall report to the European Parliament and the Council on the possibility of allowing for the application of paragraph 1 also to a subsidiary that is subject to authorisation and supervision by a Member State other than the Member State that authorises and supervises the institution which is the parent undertaking. The Commission shall pay particular attention to progress made on completing the banking union, and more particular to improvements made to the banking crisis management and deposit insurance framework which can address potential financial stability concerns resulting from applying paragraph 1 on a cross-border basis.

RemovedThe Commission shall also consider whether or not additional prudential safeguards and technical modifications could further address any potential financial stability concerns resulting from the waiver from the application of individual requirements on a cross-border basis.

RemovedThe report shall address the case of partial waivers from prudential requirements, taking into consideration whether the application of waivers on a cross-border basis, should be accompanied by the requirement for the relevant subsidiaries to still have adequate minimum levels of own funds to ensure their resilience, also in distressed situations. Competent authorities may define an adequate amount, taking into account the efficiency of group risk management and the effectiveness of the group financial support arrangement in resolution.

RemovedThat report may, where appropriate, be accompanied by a legislative proposal. In the event that the Commission considers that the conditions to make a legislative proposal are not yet met, the Commission shall report on progress made on the banking union every two years until such time it deems it appropriate to make such a legislative proposal.’;

Removed(3b) Article 8 is replaced by the following:

Removed‘Article 8

RemovedDerogation from the application of liquidity requirements on an individual basis

Removed1. The competent authorities may waive in full or in part the application of Part Six to an institution and to all or some of its subsidiaries in the Union and supervise them as a single liquidity sub-group so long as they fulfil all of the following conditions:

Removed(a) the parent institution on a consolidated basis or a subsidiary institution on a sub-consolidated basis complies with the obligations laid down in Part Six;

Removed(b) the parent institution on a consolidated basis or the subsidiary institution on a sub-consolidated basis monitors and has oversight at all times over the liquidity positions of all institutions within the group or sub-group, that are subject to the waiver, monitors and has oversight at all times over the funding positions of all institutions within the group or sub-group where the net stable funding ratio (NSFR) requirement set out in Title IV of Part Six is waived, and ensures a sufficient level of liquidity, and of stable funding where the NSFR requirement set out in Title IV of Part Six is waived, for all of those institutions;

Removed(c) all entities belonging to the single liquidity sub-group have entered into a group financial support agreement as defined in Directive 2014/59/EU, or another group financial support agreement that the competent authorities deem satisfactory, which requires the parent undertaking to provide liquidity support and does not provide for any upper limit to the level of support that can be provided and that would not be revocable at short notice;

Removed(d) the institutions have entered into contracts that, to the satisfaction of the competent authorities, provide for the free movement of funds between them to enable them to meet their individual and joint obligations as they become due;

Removed(e) the institution leading the liquidity sub-group provides an independent legal opinion to the competent authorities on the enforceability of this group financial support agreement that confirms the absence of any legal impediments to the transfer of liquidity across the entities belonging to the single liquidity sub-group;

Removed(f) the single liquidity sub-group is covered by a single group recovery plan that includes recovery plan indicators for each entity of the liquidity sub-group including the parent undertaking that are consistent with the liquidity sub-group’s internal liquidity management policy;

Removed(g) the single liquidity sub-group belongs to a banking group which is subject to a group resolution scheme in accordance with Article 92 of Directive 2014/59/EU.

RemovedThe group financial support agreement may also be used to satisfy the condition under point (d) of this paragraph.

Removed3. Where institutions of the single liquidity sub-group are authorised in several Member States, paragraph 1 shall only be applied after following the procedure laid down in Article 21 and the competent authorities may waive in full or in part the application of the requirements set out in Part 6.

Removed4. Competent authorities may also apply paragraphs 1 and 3 to institutions which are members of the same institutional protection scheme as referred to in Article 113(7) provided that they meet all the conditions laid down therein, and to other institutions linked by a relationship referred to in Article 113(6) provided that they meet all the conditions laid down therein. Competent authorities shall in that case determine one of the institutions subject to the waiver to meet Part Six on the basis of the consolidated situation of all institutions of the single liquidity sub-group.

Removed5. Where a waiver has been granted under paragraph 1 or paragraph 3, the competent authorities may also apply Article 86 of Directive 2013/36/EU, or parts thereof, at the level of the single liquidity sub-group and waive the application of Article 86 of Directive 2013/36/EU, or parts thereof, on an individual basis.

Removed6. Where, in accordance with this Article, a competent authority waives, in part or in full, the application of Part Six for an institution, it may also waive the application of the associated liquidity reporting requirements under point (d) of Article 430(1) for that institution.

Removed6a. Waivers granted under this Article prior to [the date of application of CRR3 (e.g. 1.1.2025)] shall remain in force for [[24 months] after the date of application of CRR3], provided that the conditions specified in the version of this Article applicable prior to [the date of application of CRR3 (e.g. 1.1.2025)] continue to be met. After [date [24 months] after the date of application of CRR3], such waivers shall continue to remain in force, provided that the applicable conditions specified in Article 8 (1) or (2) are met.

Removed6b. By 31 December 2025, the Commission shall report to the European Parliament and the Council on the legal form and specific prudential treatment for group financial support agreements. The report shall be accompanied, where appropriate, by a legislative proposal.

RemovedBy 31 December 2026, the Commission shall review and report on the functioning of paragraph 1 of this Article and shall submit that report to the European Parliament and the Council. The Commission’s review and report shall assess, in particular, whether the elements and conditions specified in this Article provide sufficient flexibility to competent authorities to define institution-specific requirements as necessary for waiving the application of liquidity requirements, where justified by the efficiency of group risk management and the effectiveness of the group financial support arrangement in resolution. The Commission’s review and report shall also take into account any financial stability concerns and progress made towards completing the banking union, and more particularly to improvements made to the banking crisis management framework and the Union deposit guarantee framework which can further strengthen the consistency in liquidity management during going concern and crisis times. The report shall be accompanied, where appropriate, by a legislative proposal.

Removed(4) in Article 10a, the single paragraph is amended as follows:

Removed‘For the purposes of the application of this Chapter, investment firms and investment holding companies shall be considered to be parent financial holding companies in a Member State or Union parent financial holding companies where such investment firms or investment holding companies are parent undertakings of an institution or of an investment firm subject to this Regulation that is referred to in Article 1(2) or (5) of Regulation (EU) 2019/2033.’;

Removed(5) in Article 11(1), the first sentence is replaced by the following:

Removed‘Parent institutions in a Member State shall comply, to the extent and in the manner set out in Article 18, with the obligations laid down in Parts Two, Three, Four, Seven and Seven A on the basis of their consolidated situation, with the exception of Article 92(3), point (a), and Article 430(1), point (d).’;

Removed(5a) in Article 13(1), subparagraph 2 is replaced by the following:"

Removed‘Large subsidiaries of EU parent institutions shall disclose the information specified in Articles 437, 438, 440, 442, 449a, 450, 451, 451a and 453 on an individual basis or, where applicable, in accordance with this Regulation and Directive 2013/36/EU on a sub-consolidated basis.’;

Removed(6) Article 18 is amended as follows:

Removed(a) paragraph 2 is deleted;

Removed(b) in paragraph 7, first sub-paragraph, the first sentence is replaced by the following:

Removed‘Where an institution has a subsidiary which is an undertaking other than an institution or a financial institution or holds a participation in such an undertaking, it shall apply to that subsidiary or participation the equity method.’;

Removed(c) a new paragraph 10 is inserted:

Removed‘10. EBA shall report to the Commission by [OP please insert date = 1 year after the entry into force of this Regulation] on the completeness and appropriateness of the set of definitions and provisions of this Regulation concerning the supervision of all types of risks to which institutions are exposed at a consolidated level. EBA shall assess in particular any possible remaining discrepancies in those definitions and provisions alongside their interaction with the applicable accounting framework, and any remaining aspect that might pose unintended constraints to a consolidated supervision that is comprehensive and adaptable to new sources or types of risks or structures that might lead to regulatory arbitrage. EBA shall periodically update its report on a bi-annual basis.

RemovedIn the light of EBA’S findings, the Commission may, if appropriate, adopt delegated acts in accordance with Article 462 to adjust the relevant definitions or the scope of prudential consolidation.’;

Removed(6a) in Article 19(1), the introductory part is replaced by the following:

Removed‘1. An institution or a financial institution which is a subsidiary or an undertaking in which a participation is held, need not to be included in the consolidation where the total amount of assets and off-balance sheet items of the undertaking concerned is less than the smaller of the following two amounts:’;

Removed(7) Article 20 is amended as follows:

Removed(a) paragraph 1 is amended as follows:

Removed(i) point (a) is replaced by the following:

Removed‘(a) in the case of applications for the permissions referred to in Article 143(1), Article 151, paragraphs 4 and 9, Article 283 and Article 363 submitted by an EU parent institution and its subsidiaries, or jointly by the subsidiaries of an EU parent financial holding company or EU parent mixed financial holding company, to decide whether or not to grant the permission sought and to determine the terms and conditions, if any, to which such permission should be subject;’;

Removed(ii) the third subparagraph is deleted;

Removed(b) paragraph 6 is replaced by the following:

Removed‘6. Where an EU parent institution and its subsidiaries, the subsidiaries of an EU parent financial holding company or an EU parent mixed financial holding company use the IRB Approach referred to in Article 143 on a unified basis, the competent authorities shall allow the parent and its subsidiaries, considered together, to meet the qualifying criteria set out in Part Three, Title II, Chapter 3, Section 6 in a way that is consistent with the structure of the group and its risk management systems, processes and methodologies.’;