On October 3, 2014, the EBA launched a consultation on proposed draft RTS and proposed guidelines on the conditions for the provision of financial support by a group entity to another group entity that meets the requirements for early intervention under the Banking Recovery and Resolution Directive ("BRRD"). Under the BRRD, member states are required to remove any legal obstacles to intra-group financial support agreements subject to certain limitations which may be imposed under CRR and CRD IV. The BBRD sets out certain conditions for the provision of support which relate to the expected success of the support, the impact on financial stability, prudential requirements applicable to the providing entity providing support and the terms of the support. The EBA must provide draft RTS to the European Commission further specifying some of those conditions, and it must also issue guidelines which will help to promote harmonized approaches to other conditions. The consultation also proposes draft ITS on the form and content of the disclosure of support agreements as required under the BRRD. The EBA proposes that the general terms of a support agreement should be made available on a firm's website setting out all of the relevant information while taking into account the need for confidentiality of certain specific information. The consultation closes on January 4, 2015.
The consultation paper is available at: http://www.eba.europa.eu/documents/10180/835368/EBA-CP-2014-30+%28CP+on+RTS+and+GL+on+Conditions+for+Group+Fin++Support+and+on+ITS+on+Disclosure%29.pdf.
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