317. When an institution becomes bound by the output floor as set out in Article 92(3) of …

When an institution becomes bound by the output floor as set out in Article 92(3) of Regulation (EU) No 575/2013, competent authorities should:

• a. ensure the nominal amount of P2R does not automatically increase as a result of the institution becoming bound by the output floor (‘ temporary cap ’) , in accordance with Article 104a(6) point (a) of Directive 2013/36/EU. To this end, the applicable percentage of the P2R previously communicated to the institution by the competent authority following the last SREP cycle will be applied to the institution’s unfloored TREA (U-TREA), as set out in Article 92(4) of Regulation (EU) No 575/2013. This approach will remain in place until the performance of the review described in point b;
• b. without delay, and no later than the end date of the next SREP, review the P2R imposed on the institution in accordance with Article 104(1), point (a) of Directive 2013/36/EU. As part of this review, competent authorities should:
• i. remove any part of the P2R that may be covering regulatory model deficiencies for the calculation of own funds requirements that is already covered by the output floor, in order to eliminate any potential double-counting effects;
• ii. consider whether there are arithmetic effects (i.e. where the P2R nominal amount increase is not due to an increase in risk but results from the P2R being expressed as a percentage of TREA) on the nominal amount of P2R arising from the automatic increase in the TREA due to the fact that the institution has become bound by the output floor, and remove them as appropriate;
• c. communicate to the institutions the applicable own funds requirements following the review in point (b), emphasising, in particular, any findings related to double counting elements. Competent authorities may also require institutions to disclose, as part of their Pillar 3 reporting, the impact of either the temporary cap or the review of double counting
• – whichever is applicable at the reference date – on the reported P2R.

1. Pregled

1.1 Reference

• Članak 92. 3.
• Članak 92. 4.

1.2 Utvrđeni zahtjevi

1.3 Povezani standardi

2. Utvrđeni zahtjevi

3. Povezani standardi

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