On February 9, 2016, the EBA published its Opinion expressing its disagreement with certain of the European Commission’s proposed amendments to the final draft Regulatory Technical Standards on the criteria for setting the Minimum Requirement for Own Funds and Eligible Liabilities (MREL). MREL is the European equivalent of US TLAC. The EBA submitted the draft RTS to the Commission in July 2015. The Commission proposed a number of amendments in December 2015. The EBA disagrees on, amongst other things: (i) the removal of the reference to a minimum contribution to loss absorption and recapitalization of 8% of total liabilities and own funds; (ii) the removal of the test for downward adjustments to the recapitalization amount and peer group reference for systemic institutions; and (iii) the removal of the upper limit (48 months) on the transitional compliance period, instead making reference to a transitional period that is “as short as possible.” The EBA has resubmitted a further revision of the draft RTS to the Commission as an Annex to the Opinion.

The Opinion is available at: http://www.eba.europa.eu/documents/10180/1359456/EBA-Op-2016- 02+Opinion+on+RTS+on+MREL.pdf.