Extensive changes in bank supervision and settlement

Mar 24, 2021 Benn-Ibler Rechtsanwälte

In order to implement EU requirements, a number of provisions under capital market law are to be amended. The core points concern new licensing obligations, capital requirements, anti-money laundering and anti-terrorism measures as well as the winding-up of banks.

Among other things, the draft provides for certain financial holding companies to be subject to a licensing requirement. According to the legal materials, this is to ensure that the regulatory requirements are met on a consolidated basis within the entire group.

Furthermore, the provisions on equity capital requirements are to be clarified. In particular, according to the proposal, a distinction is made between the additional equity capital requirement (Sec. 70b Banking Act, Bankwesengesetz, BWG), the supervisory expectation (Sec. 70c BWG) and additional liquidity requirements (Sec. 70d BWG).

The new Sec. 70b BWG defines cases in which the Financial Market Authority (Finanzmarktaufsichtsbehörde, FMA) can impose additional capital requirements on credit institutions. This applies, for example, if the credit institution is exposed to risks that are not adequately covered by the other capital requirements.

The government draft also provides for amendments to the provisions on the capital conservation buffer, capital conservation measures and macroprudential instruments. The amendments include clarifications as to which measures are permissible to collateralize which risks.

Another point concerns the expansion of measures to combat money laundering and terrorist financing. The government draft is intended to improve cooperation between the authorities involved and the mutual exchange of information. For example, an amendment to the BWG is planned, according to which the FMA must report to the European Banking Authority in the event of "reasonable suspicion" of money laundering or terrorist financing.

There are also to be innovations in the area of the winding-up of banks. According to the legal materials, the two wind-up strategies (wind-up of the parent company only, wind-up of several companies in the group) are to be legally anchored. In particular, the concepts of " wind-up unit" and "wind-up group", along with supplementary requirements, are to be introduced into the Recovery and Wind-Up Act (Sanierungs- und Abwicklungsgesetz).

663 dB XXVII. GP – Government draft – Explanatory notes