Newsletter 02/2014
EBA publishes standard on classes of instruments eligible for variable remuneration use under CRD IV

This, the second draft RTS issuing from the EBA so far in 2014, addresses the classes of instruments that are appropriate to be used for the purposes of variable remuneration under Article 94(2) of the CRD IV Directive.

CRD IV requires that at least 50% of the variable remuneration of staff whose professional activities have a material impact on the institution’s risk profile must be awarded in non-cash instruments. In accordance with Article 94(1)(l) of the Directive, the instruments must consist of a balance of (i) shares, share-linked or equivalent non-cash instruments and, (ii) where possible, Additional Tier 1 (AT 1), Tier 2 or other instruments, subject to the conditions set out in the CRD and this draft RTS.

The draft RTS introduce requirements for AT 1, Tier 2 and Other Instruments, to ensure that they appropriately reflect the credit quality of the institution, and define for Tier 2 and Other Instruments the write-down, write-up and conversion mechanisms. Specific requirements have been designed for Other Instruments that do not count as regulatory own funds under the Capital Requirements Regulation, which defines such things.

Click here to download the draft RTS.

27 February 2014
In This Issue
Central Bank News
Revised Corporate Governance Code for Credit Institutions and Insurance Undertakings
Financial Crime
Central Bank to Regulate Trust and Company Service Providers for AML
Princess Cristina of Spain in Court Over Alleged Money Laundering
Ted Cunningham Pleads Guilty to Money Laundering
Financial Services Ombudsman Can Name and Shame
Insurance News
12 Month Non-Solicitation Period for Insurance Brokers Confirmed
EBA proposes a definition of 'fixed overheads' and capital charge for use of tied agents
EBA publishes standard on classes of instruments eligible for variable remuneration use under CRD IV
Training March - June 2014
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