EBA has published a near-final version of draft regulatory technical standards (RTS) it will submit to the Commission once the text of the Capital Requirements Regulation (CRR) is confirmed. The RTS develop the requirements on own funds under CRR, specifying:

  • how dividends have to be deducted from profits;
  • limits on the cooperative banking sector's ability to redeem the capital instruments it issues;
  • how losses, deferred tax assets and defined benefit pension fund assets must be deducted from own funds;
  • rules on the activation of hybrid instruments;
  • how to estimate underlying exposures arising from index holdings;
  • restrictions on the use of special purpose entities for indirect issuance of own funds;
  • the process for receiving supervisory permission to reduce own funds;
  • waivers applicable during the implementation of financial assistance plans; and
  • transitional provisions and grandfathering of instruments.

(Source: Near-Final Draft RTS on Own Funds)