122. Investment firms which do not have a sound capital base or where the soundness of the capital …

Investment firms which do not have a sound capital base or where the soundness of the capital base is at risk should take the following measures with regard to variable remuneration:

• a. reduce the variable bonus pool, including the possibility to reduce it down to zero;
• b. apply the necessary performance adjustment measures, in particular malus;
• c. use the net profit of the investment firm for that year and potentially for subsequent years to strengthen the capital base. The investment firm should not compensate for any reduction of the variable compensation made in order to ensure a sound capital basis in later years or by other payments, vehicles or methods which lead to a circumvention of this provision.

1. Overview

1.1 References

1.2 Identified Requirements

1.3 Related Standards

2. Identified Requirements

3. Related Standards

• EBA - Published by the European Banking Authority at https://www.eba.europa.eu/