A stable, well-functioning financial market for allA stable, well-functioning financial market for allEBA's MDA Opinion does not change Pillar 2 in Sweden
In response to the Opinion published by the European Banking Authority (EBA) on 18 December 2015 regarding restrictions on distributions linked to the combined buffer requirement (Opinion of the European Banking Authority on the interaction of Pillar 1, Pillar 2 and combined buffer requirements and restrictions on distributions), Finansinspektionen would like to comment as follows.
Finansinspektionen welcomes EBA's view that the restrictions on distributions (the MDA factor) should take into consideration the capital requirements under both Pillar 1 and Pillar 2 when being calculated. This is in line with how the capital requirements under Pillar 2 are implemented in Swedish legislation
Finansinspektionen would also like to clarify that EBA's Opinion does not entail any changes to Finansinspektionen's process for assessing and determining the banks' Pillar 2 requirements.
More specifically, Finansinspektionen intends to continue its practice of, in normal situations, not making a formal decision about the capital requirement under Pillar 2. Insofar that a formal decision has not been made, the capital requirement under Pillar 2 does not affect the level at which the automatic restrictions on distributions linked to the combined buffer requirement come into effect.
A description of Finansinspektionen's process for the capital assessment under Pillar 2 can be found in section 2 of the memorandum, "Capital Requirements for Swedish Banks", which was published in September 2014. EBA's Opinion does not entail any changes to FI's position regarding Pillar 2, which is described in this memorandum.
