Gibraltar Resolution Planning Framework Industry Dialogue Workshop: Content of Resolution Plans 21 February 2018

Today’s Content Q&A update Other GBA Questions on MREL Template IDW Questions on Template Update on MREL setting Secure data transfer Industry Dialogue Workshops Next Steps Questions/Comments 21 February 2018

Q&A Update Official EBA response to Consultation on new ITS’ due in March 2018 EBA have commented that Gibraltar RCU’s input to the Consultation was ‘extremely useful’. Q&A document which is available on the RCU website (link below) will now be updated http://www.fsc.gi/Resolution%20and%20Compensation%20Unit Additional GBA feedback from Jan 2018 to be added to the Q&A 21 February 2018

Questions to the EBA (1) Q1: How will FS restatements be managed on templates. A1 (from EBA): If audit is not completed then unaudited figures may be submitted, and corrected figures will be submitted when available. Q2: For ‘Entity type’ included in R01.00, if multiple licences are held by a firm, how is this to be populated? A2 (from EBA): Banks will report only one type, in priority the ‎first type applicable in the list. E.g if the entity is a credit institution then no other type is reported. Q3: Can further definition be provided in the Instructions for ‘Share Capital’ within R01.00 (i.e. paid and unpaid)? A3 (from EBA): Share capital should exclude reserves. 21 February 2018

Questions to the EBA (2) Q4: What is reasoning behind the inclusion of the detail (110-200) on MREL template, if these liabilities are not to be used in any case for Bail-In. A4: (from EBA): RAs are required to have a good overview of what is not, both to calculate MREL, implement bail in, and implement transfer strategies. Q5: Given the difficulties that firms may have in getting detail on counterparties, the reasoning behind the split of counterparties (specifically 020 and 030). A5: This is required by the RA to understand what bail-inable liabilities are available and who the counterparties are Q6: Does the EBA consider that the application of MREL will require changes to client wording on terms and conditions? A6 (from EBA): TBC’d – further EBA engagement required 21 February 2018

Questions to the EBA (3) Q7: Can an example be provided on the Instruction of what ‘Code’ is to be used for R05.01 and R05.02? A7: (from EBA): Codes instructions have been harmonised on instructions‎: LEI as a matter of priority. Q8: Does the EBA consider that the application of MREL will require changes to client wording on terms and conditions? A8 (From EBA): It is proposed that BRRD2 addresses this but this is to be confirmed as text is not finalised. 21 February 2018

Follow-Up Questions from Industry Q1: Capital Buffers – are these envisaged to be factored in to the calculation of the “Informative MREL”? A2: Informative MREL will include capital buffers where they become a regulatory requirement – the RCU will send formal email to each firm on this (including interim deadline). For the 2019 MREL review buffers may not be included for recapitalisation amount (ie potential upside) Q2: ICAAP – is this envisaged to be factored in to the calculation of the “Informative MREL”? A2: Informative MREL is to be calculated using regulatory capital requirement (not including any additional internal specific capital buffers etc) Q3: Commitment Guarantee – have there been any further discussions on the possibility of commitment guarantees from other group entities as an alternative to the requirement to hold capital? A3: These may form part of BRRD2 but likely (if included) to only be relevant for Internal MREL firms (to be monitored by RCU) 21 February 2018

Other IDW Questions 21 February 2018

MREL Update MREL full compliance date: 31st January 2022 (as discussed in December Interim MREL compliance date (non-binding, non-enforceable date): 31st January 2021 (now agreed at FSRCC) RCU to now follow up with formal email communications to firms with MREL roadmap included 21 February 2018

Secure transfer of Data The RCU will be providing the functionality to upload data securely to a protected GFSC Cloud sitting on the GFSC server – it is envisaged that this will replace email/data keys etc. going forward. Long term ‘Data point model’ discussion continue with Invoke (however at early stages due to infancy of new ITS’) LETS DISCUSS ! 21 February 2018

Industry Dialogue Workshops Content of Resolution Plans: 3rd November Introduction to MREL and MREL setting: 6th December Data liquidity template: February 21st 2018 Simplified Obligations: February 28th 2018 Critical Functions\Shared Services: March 21st 2018 21 February 2018

Next Steps The RCU will discuss any Cross-Border requirements with firms individually (ie with those who have head offices elsewhere within the EU) Firms can begin to prepare for the 2018 implementation of the information templates The RCU will now begin to work closely with firms on their templates with a proposed draft submission on 14th September 2018 – 1 year following the FSRCC Seminar 2018 update seminar proposed to take place in Q4 2018 21 February 2018

Questions Comments 21 February 2018