List of credible and feasible recovery options

The starting point for the determination of the ORC should be a comprehensive full list of credible and feasible recovery options, each one of them considered independently from the others and without any reference to the recovery plan’s specific scenarios. From this list, institutions should select all the recovery options that could be used under each specific scenario showing their ‘scenario-specific recovery capacity’.

To ensure that the ORC effectively represents the ability of the institutions to restore their financial position following a significant deterioration, only recovery options that are deemed to be credible and feasible by the institutions in accordance with Title II, Chapter I, Section II of Directive 2014/59/EU, in accordance with Articles 8 to 12 of Commission Delegated Regulation 2016/1075 and in line with the general factors set out in paragraph 18 should be considered when determining the ORC.

The general factors for the credibility and feasibility assessment of the recovery options to be considered by the institutions when determining the ORC should take into account the type of option, the specific business profile of the institutions and the ongoing macroeconomic environment in which they operate and should include in particular the following elements:

• a. the expected external impact on the key stakeholders as well as any anticipated impact of the execution of the recovery option on the financial system;
• b. past experience from the implementation of the recovery option by the institution or its peers provided there is available information;
• c. level of preparedness for implementing the recovery option;
• d. assessment of the continuity of operations following the implementation of the recovery option, including all the arrangements to maintain access to financial markets and the functioning of the internal processes;
• e. the expected financial impact on the institution’s relevant capital, liquidity, profitability and risk profiles on the basis of clear and transparent key assumptions ensuring the credibility of the estimation;
• f. the anticipated timeline for the implementation of the recovery option;
• g. presence of any operational, legal, reputational and financial impediments as well as any other impediments to the implementation of the recovery option.