Article 113 › 7

With the exception of exposures giving rise to Common Equity Tier 1, Additional Tier 1 and Tier 2 items, institutions may, subject to the prior permission of the competent authorities, not apply the requirements of paragraph 1 of this Article to exposures to counterparties with which the institution has entered into an institutional protection scheme that is a contractual or statutory liability arrangement which protects those institutions and in particular ensures their liquidity and solvency to avoid bankruptcy where necessary. Competent authorities are empowered to grant permission if the following conditions are fulfilled: (a) the requirements set out in points (a), (d) and (e) of paragraph 6 are met; (b) the arrangements ensure that the institutional protection scheme is able to grant support necessary under its commitment from funds readily available to it; (c) the institutional protection scheme disposes of suitable and uniformly stipulated systems for the monitoring and classification of risk, which gives a complete overview of the risk situations of all the individual members and the institutional protection scheme as a whole, with corresponding possibilities to take influence; those systems shall suitably monitor defaulted exposures in accordance with Article 178(1); (d) the institutional protection scheme conducts its own risk review which is communicated to the individual members; (e) the institutional protection scheme draws up and publishes on an annual basis, a consolidated report comprising the balance sheet, the profit-and-loss account, the situation report and the risk report, concerning the institutional protection scheme as a whole, or a report comprising the aggregated balance sheet, the aggregated profit-and-loss account, the situation report and the risk report, concerning the institutional protection scheme as a whole; (f) members of the institutional protection scheme are obliged to give advance notice of at least 24 months if they wish to end the institutional protection scheme; (g) the multiple use of elements eligible for the calculation of own funds (hereinafter referred to as ‧multiple gearing‧) as well as any inappropriate creation of own funds between the members of the institutional protection scheme shall be eliminated; (h) The institutional protection scheme shall be based on a broad membership of credit institutions of a predominantly homogeneous business profile; (i) the adequacy of the systems referred to in points (c) and (d) is approved and monitored at regular intervals by the relevant competent authorities. Where the institution, in accordance with this paragraph, decides not to apply the requirements of paragraph 1, it may assign a risk weight of 0 %.

DIRECTIVE (EU) 2024/1619 OF THE EUROPEAN PARLIAMENT AND OF THE… (EU) · DIRECTIVE 2013/36/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of… (EU) · DIRECTIVE 2014/49/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of… (EU) · DIRECTIVE 2014/59/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of… (EU) — sign in to see which provisions, and what they say.

← 6 · All articles · 114 →

Source: EUR-Lex CELLAR · retrieved 2026-09-04