Communication on the NCMO intention to comply with the provisions of the EBA Guidelines EBA/GL/2022/12 amending Guidelines EBA/GL/2020/14 on the specification and disclosure of systemic importance indicators
In its meeting of December 15, 2022, the General Board of the NCMO approved the NCMO Decision No. D/8/2022 regarding the intention of the NCMO to comply with the provisions of the European Banking Authority Guideline EBA/GL/2022/12 amending Guideline EBA/GL/2020/14 on the specification and disclosure of systemic importance indicators. Thus, the General Board approved the intention of the NCMO to comply with the European Banking Authority Guideline EBA/GL/2022/12 amending Guideline EBA/GL/2020/14 on the specification and disclosure of systemic importance indicators, by incorporating them into the NCMO practices from the date when there will be a relevant institution (G-SII institution) within its jurisdiction, in applying the provisions of Articles 15 – 20 of the NCMO Regulation no. 2/2017 on the methodology and procedures used for setting capital buffers and the scope of these instruments, with subsequent amendments and additions.
The Guideline EBA/GL/2022/12 amends the Guideline EBA/GL/2020/14 by adding a new paragraph (10a) to section 4 – Specification of the underlying data and indicators used for the identification of G‐SIIs, specifying that, within the methodology for the identification of global systemically important institutions (G-SII) and their allocation in subcategories, the data items relevant for the calculation of adjusted cross-jurisdictional indicators concerning institutions headquartered in Member States adhering to the Single Resolution Mechanism (SRM) should be considered as part of the cross-jurisdictional activity indicators and not as ancillary or memorandum items. As a justification for the amendment of Guideline EBA/GL/2020/14, the following are mentioned: (i) the provisions of Article 131(2a) of Directive 2013/36/EU requiring an additional identification methodology that excludes cross-border activities within the Single Resolution Mechanism (SRM), and (ii) the international agreement by the Basel Committee of 31 May 2022 to acknowledge the progress made in the development of the European Banking Union.
According to the provisions of section 3 – Implementation, point 6 of Guideline EBA/GL/2022/12, this guideline is applicable starting from January 16, 2023.
The European Banking Authority Guideline EBA/GL/2022/12 amending Guideline EBA/GL/2020/14 on the specification and disclosure of systemic importance indicators was issued pursuant to Article 16 of the REGULATION (EU) No 1093/2010 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 24 November 2010 establishing a European Supervisory Authority (European Banking Authority) and is addressed also to the designated authorities referred to in Article 131 (1) of Directive 2013/36/EU, other than the competent authorities, respectively, at national level, to the National Committee for Macroprudential Supervision (NCMO). The NCMO act as designated authority within the meaning of provisions contained in Sections I and II, Chapter 4, Title VII of Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC. In accordance with the provisions of Articles 15 – 20 of the NCMO Regulation no.2/2017 on the methodology and procedure used for setting capital buffers and the scope of these instruments, with subsequent amendments and additions, the NCMO has tasks regarding the identification and reporting of G-SII institutions. Also, in accordance with the provisions of Article 3 paragraph (8) of the Law no. 12/2017 on the macroprudential oversight of the national financial system, in order to exercise its powers, the National Committee for Macroprudential Supervision ensures cooperation and exchange of information with the European Banking Authority.
So far, no global systemically important institutions (G‑SII) were identified within the Romanian banking sector, given the relatively small-sized institutions on the domestic banking market. An entity can be classified as G-SII where its leverage ratio exposure measure exceeds EUR 200 billion (as provided for in para. 6 of EBA/GL/2020/14) on a consolidated or individual basis.
The NCMO Decision No. D/8/2022 regarding the intention of the NCMO to comply with the provisions of the European Banking Authority Guideline EBA/GL/2022/12 amending Guideline EBA/GL/2020/14 on the specification and disclosure of systemic importance indicators complements the national regulatory framework represented by the NCMO Recommendation No.R/7/2022 on compliance with Guidelines EBA/GL/2022/12 amending Guidelines EBA/GL/2020/14 on the specification and disclosure of systemic importance indicators recommending the National Bank of Romania and the Financial Supervisory Authority, in their capacity as sectoral supervisory authorities, to comply with the provisions of the European Banking Authority Guidelines EBA/GL/2022/12 amending Guidelines EBA/GL/2020/14 on the specification and disclosure of systemic importance indicators from the date when there are relevant institutions (G-SIIs) within their jurisdiction and to ensure their enforceability against the relevant institutions.