On 18 March 2021, the European Banking Authority (EBA) issued a consultation paper on its revised guidelines on recovery plan indicators.
Under the mandate of Article 9(2) of the Bank Recovery and Resolution Directive (BRRD), in 2015 the EBA issued guidelines to specify the minimum list of quantitative and qualitative indicators for the purposes of recovery planning. Since the development these guidelines, significant practical experience in developing and assessing recovery plans has been acquired. Against this background, the EBA has concluded that, while limited amendments to the 2015 guidelines are needed, it is necessary to introduce additional guidance on certain parts of the indicator framework.
In terms of the indicator framework, the EBA is proposing to include additional guidance on the general principles to follow in setting the thresholds of recovery plan indicators, focusing on the treatment of recovery indicators in crisis particularly in the case of application of supervisory relief measures. On the latter, the revised guidelines clarify that, in the case of systemic crisis, there should not be automatic recalibration of recovery plan indicators due to supervisory relief measures unless in duly justified cases and agreed with the Member State competent authority. The revised guidelines also recognise the importance of timely notification of recovery indicators’ breaches and of frequent monitoring of indicators in a situation of crisis for the institution and the Member State competent authority.
The deadline for comments on the consultation paper is 18 June 2021.