ECON - banking crisis management (EN-EN)

Source: SCICNET
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resolution
means the restructuring of an institution in order to ensure the continuity of its essential functions, preserve financial stability and restore the viability of all or part of that institution;
credit institution
means a credit institution as defined in Article 4(1) of Directive 2006/48/EC;
investment firm
means an investment firm as defined in Article 3(1)(b) of Directive 2006/49/EC that are subject to the initial capital requirement specified in Article 9 of that Directive
financial institution
means a financial institution as defined in Article 4(5) of Directive 2006/48/EC
subsidiary
means subsidiary as defined in Article 4(13) of Directive 2006/48/EC
parent undertaking
means a parent undertaking as defined in Article 4(12) of Directive 2006/48/EC
consolidated basis
means on the basis of the consolidated financial situation of a group subject to supervision on a consolidated basis in accordance with Subsection I of Section 2 of Chapter 2 of Title V of Directive 2006/48/EC
financial holding company
means a financial institution, the subsidiary undertakings of which are either exclusively or mainly institutions or financial institutions, at least one of such subsidiaries being an institution, and which is not a mixed financial holding company within
mixed financial holding company
means a mixed financial holding company as defined in Article 2(15) of Directive 2002/87/EC
mixed-activity holding company
means a mixed-activity holding company as defined in Article 4(20) of Directive 2006/48/EC, or a mixed-activity holding company as defined in Article 3(3(b) of Directive 2006/49/EC
parent financial holding company in a Member State
means a financial holding company which is not itself a subsidiary of an institution authorised in the same Member State, or of a financial holding company or mixed financial holding company set up in the same Member State
Union parent financial holding company
means a parent financial holding company which is not a subsidiary of an institution authorised in any Member State or of another financial holding company or mixed financial holding company set up in any Member State
parent mixed financial holding company in a Member State
means a mixed financial holding company which is not itself a subsidiary of an institution authorised in the same Member State, or of a financial holding company or mixed financial holding company set up in the same Member State
Union parent mixed financial holding company
means a parent mixed financial holding company which is not a subsidiary of a credit institution authorised in any Member State or of another financial holding company or mixed financial holding company set up in any Member State;
resolution objectives
means the objectives specified in Article 26(2)
branch
means a branch as defined in Article 4 (3) of Directive 2006/48/EC
resolution authority
means an authority designated by a Member States in accordance with Article 3
resolution tool
means the sale of business tool, the bridge institution tool, the asset separation tool or the bail-in tool
resolution power
means a power as referred to in Article 56(1)
competent authority
means competent authority as defined in Article 4(4) of Directive 2006/48/EC or as defined in Article 3(3)( c) of Directive 2006/49/EC
competent ministries
means the finance ministries or other ministries responsible for economic, financial and budgetary decisions according to national competencies
control
means the relationship between a parent undertaking and a subsidiary, as defined in Article 1 of Directive 83/349/EEC, or a similar relationship between any natural or legal person and an undertaking
institution
means a credit institution or an investment firm
management
means the persons who effectively direct the business of the credit institution in accordance with Article 11 of Directive 2006/48/EC
group
means a parent undertaking and its subsidiaries
extraordinary public financial support
means State Aid within the meaning of Article 107 (1) of the Treaty on the Functioning of the European Union, that is provided in order to preserve or restore the viability, liquidity or solvency of an institution
group entity
means a legal entity that is part of a group
recovery plan
means a plan drawn up and maintained by an institution in accordance with Article 5
critical functions
means those activities, services and operations the discontinuance of which would be likely to result in a disruption of the economy of, or the financial markets in, one or more Member States
core business lines
means business lines and associated services which represent material source of revenue, profit or franchise value for an institution
consolidating supervisor
means the competent authority responsible for supervision on a consolidated basis as defined in Article 4(48) of Directive 2006/48/EC
own funds
means own funds within the meaning of Chapter 2 of Title V of Directive 2006/48/EC
conditions for resolution
means the conditions specified in Article 27(1)
resolution action
means the decision to place an institution under resolution pursuant to Article 27, the application of a resolution tool to, or the exercise of one or more resolution power in relation to an institution
resolution plan
means a plan drawn up for an institution by the relevant resolution authority in accordance with Article 9
group resolution
"means one of the following: (a) the taking of a resolution action at the level of the parent undertaking or institution subject to consolidated supervision, or (b) the coordination of the application of resolution tools and the exercise of resolution powers by resolution authorities in relation to group entities that meet the conditions for resolution;"
group resolution plan
means a plan for group resolution drawn up in accordance with Articles 11 and 12
group level resolution authority
means the resolution authority in the Member State in which the consolidating supervisor is situated
resolution college
means a college established in accordance with Article 80 to carry out the tasks required by Articles 12, 13 and 83
normal insolvency proceedings
mean the collective insolvency proceedings which entail the partial or total divestment of a debtor and the appointment of a liquidator, normally applicable to institutions under national law and either specific for those institutions or generally applica
debt instruments
means bonds and other forms of transferable debt, any instrument creating or acknowledging a debt, and instruments giving rights to acquire debt instruments;
parent institution in a Member State
means a parent credit institution in a Member State as defined in Article 4(14) of Directive 2006/48/EC, or a parent investment firm in a Member State as defined in Article 3(f) of Directive 2006/49/EC;
Union parent institution
means a Union parent credit institution as defined in Article 4(16) of Directive 2006/48/EC, or an Union parent investment firm as defined in Article 3(g) of Directive 2006/49/EC;
own funds requirements
means the requirements of Article 75 of Directive 2006/48/EC;
supervisory colleges
means a college of supervisors established in accordance with Article 131a of Directive 2006/48/EC;
Union State aid framework
means the framework established by Articles 107 and 108 of the Treaty on the Functioning of the European Union and regulations made or adopted pursuant to Article 107 or Article 106(4) of the Treaty on the Functioning of the European Union;
winding up
means the realisation of assets of an institution;
asset separation tool
means the transfer by a resolution authority exercising the transfer powers of assets and rights of an institution that meets the conditions for resolution to an asset management vehicle in accordance with Article 36;
bail-in tool
means the exercise by a resolution authority of the write-down and conversion powers in relation to liabilities of an institution that meets the conditions for resolution in accordance with Article 37;
sale of business tool
means the transfer by a resolution authority of instruments of ownership, or assets, rights or liabilities, of an institution that meets the conditions for resolution to a purchaser that is not a bridge institution, in accordance with Article 32;
bridge institution tool
means the power to transfer the assets, rights or liabilities of an institution that meets the conditions for resolution to a bridge institution, in accordance with Article 34;
bridge institution
means a legal entity that is wholly owned by one or more public authorities (which may include the resolution authority) and that is created for the purpose of receiving some or all of the assets, rights and liabilities of an institution under resolution
instruments of ownership
means shares, instruments that confer ownership in mutual associations, instruments that are convertible into or give the right to acquire shares or instruments of ownership, and instruments representing interests in shares or instrument of ownership;
transfer powers
means the powers specified in points (c), (d) or (e) of Article 56(1) to transfer shares, other instruments of ownership, debt instruments, assets, rights or liabilities, or any combination of those items from an institution under resolution to a recipien
central counterparty
means a legal entity that interposes itself between the counterparties to a trade within one or more financial markets, becoming the buyer to every seller and the seller to every buyer;
derivatives
means a financial instrument listed in points (4) to (10) of Section C of Annex I to Directive 2004/39/EC of the European Parliament and of the Council[35];
write-down and conversion powers
means the powers specified in points (f) to (l) of Article 56(1);
secured liability
means a liability where the right of the creditor to payment is secured by a charge over assets, a pledge or lien, or collateral arrangements including liabilities arising from repurchase transactions and other title transfer collateral arrangements;
Additional Tier 1 instruments
means capital instruments that qualify as own funds under Article 57(ca) of Directive 2006/48/EC;
aggregate amount
means the aggregate amount by which the resolution authority has assessed that eligible liabilities must be written down or converted, in accordance with Article 41(1);
Common Equity Tier 1 instruments
means capital instruments that qualify as own funds in accordance with Article 57(a) of Directive 2006/48/EC;
eligible liabilities
means the liabilities of an institution that are not excluded from the scope of the write-down tool by virtue of Article 38(2);
deposit guarantee scheme
means a deposit guarantee scheme introduced and officially recognised by a Member State pursuant to Article 3 of Directive 94/19/EC;
Tier 2 instruments
means capital instruments that qualify as own funds under Article 56(f) and (h) of Directive 2006/48/EC;
relevant capital instruments
means Additional Tier 1 instruments and Tier 2 instruments;
conversion rate
means the factor that determines the number of ordinary shares into which a liability of a specific class will be converted, by reference either to a single instrument of the class in question or to a specified unit of value of a debt claim;
affected creditor
means a creditor whose claim relates to a liability that is reduced or converted to shares by exercise of a write down or conversion power;
affected shareholder
means a shareholder whose shares are cancelled by means of the power referred to in point (j) of Article 56(1);
appropriate authority
means authority of the Member State identified in accordance with Article 54 that is responsible under the national law of that State for making the determinations referred to in Article 51(1);
relevant parent institution
means a parent institution in a Member State, a Union parent institution, a financial holding company, a mixed financial holding company, a mixed-activity holding, a parent financial holding company in a Member State, a Union parent financial holding comp
recipient
means the entity to which the shares, other instruments of ownership, debt instruments, assets, rights or liabilities, or any combination of those items from an institution under resolution are transferred;
business day
means any day other than Saturday, Sunday and any day which is a public holiday in the home Member State of the institution;
termination right
means a right to terminate a contract on an event of default as defined in or for the purposes of the contract, and includes any related right to accelerate, close out, set-off or net obligations or any related provision that suspends, modifies or extingu
institution under resolution
means an institution, a financial institution, a financial holding company, a mixed financial holding company, a mixed-activity holding company, a parent financial holding company in a Member State, a Union parent financial holding company, a parent mixed
domestic subsidiary institution
means an institution which is established in a Member State that is a subsidiary of a third country institution or financial holding company;
Union parent undertaking
means a Union parent institution, an Union parent financial holding company or a Union parent mixed financial holding company;
third country institution
means an entity, the head office of which is established in a third country, that is authorised or licensed under the law of that third country to carry on any of the activities listed in Annex I to Directive 2006/48/EC or Section A of Annex I to Directiv
third country resolution proceeding
means an action under the law of a third country to manage the failure of a third country institution that is comparable, in terms of results, to resolution actions under this Directive;
domestic branch
means a branch of a third country institution that is established in a Member State;
relevant third country authority
means a third country authority responsible for carrying out functions comparable to those of resolution authorities or competent authorities pursuant to this Directive;
group financing arrangement
means the financing arrangement or arrangements of the Member State of the group level resolution authority;
back to back transaction
means a transaction entered into between two group entities for the purpose of transferring, in whole or in part, the risk generated by another transaction entered into between one of those group entities and a third party;
intra-group guarantee
means a contract by which one group entity guarantees the obligations of another group entity to a third party.