On 20 June 2014, the European Commission published a consultation paper on the contributions of credit institutions to resolution financing arrangements under the Bank Recovery and Resolution Directive (2014/59/EU) (BRRD) and the Single Resolution Mechanism Regulation (SRM Regulation).
The consultation paper relates to the Commission's work under Article 103(7) of the BRRD, which gives the Commission the power to adopt a delegated act specifying the notion of adjusting contributions in proportion to the risk profile of institutions. It also relates to the Commission's work under Article 66 of the SRM Regulation, which gives the Commission the power to adopt a proposal for an equivalent Council implementing act on the methodology for the calculation of individual contributions for credit institutions in banking union.
The consultation invites comments on the following issues:
- The calculation of contributions and, in particular, the whether the contributions of groups should be calculated at individual or consolidated level.
- The application of the principle of proportionality to contributions payable by small credit institutions.
- The respective weightings of the "flat" contribution and the risk-adjusted part of the contribution under Article 103(2) of the BRRD and Article 66 of the SRM Regulation.
- The individual risk indicators used to assess credit institutions' risk profiles and to produce an adjustment mechanism for the flat contribution.
The deadline for responses is 14 July 2014. The Commission intends to adopt the delegated act under the BRRD and the proposal for the Council simultaneously in September 2014.