text: Published in Dziennik Ustaw (Dz. U.) of 2014, item 872.

text: Regulation (EU) 2015/751

text: of the European Parliament and of the Council of 29 April 2015 on interchange fees for card-based payment transactions (OJ L 123, 19.5.2015, p.1).

text: ‘Payment scheme’ is defined as a set of rules for the execution of payment transactions, the rules for issuing and acquiring of payment instruments by payment service providers and the rules for the processing of payment transactions carried out using payment instruments, in particular a payment card scheme.

text: The ECB’s interpretation is based on the understanding that the different elements of the definition of ‘payment scheme’ apply cumulatively.

text: Eurosystem oversight policy framework, September 2015, available on the ECB’s website at: http://www.ecb.europa.eu.

text: Proposed new Art. 132zu of the Law on Payment Services.

text: Regulation (EU) No 260/2012

text: of the European Parliament and of the Council of 14 March 2012 establishing technical and business requirements for credit transfers and direct debits in euro and amending

text: Regulation (EC) No 924/2009

text: (OJ L 94, 30.3.2012, p. 22).

text: See the relevant guides for the assessment of direct debit schemes and credit transfer schemes against the oversight standards, November 2014, available on the ECB’s website at www.ecb.europa.eu.

text: See paragraph 2.3 of Opinion

text: . All ECB opinions are published on the ECB’s website at www.ecb.europa.eu.

text: See the ECB’s 2016 Convergence Report, p.25.

title: Opinion of the European Central Bank of 28 July 2016 on the oversight of payment schemes (CON/2016/38)

text: OPINION OF THE EUROPEAN CENTRAL BANK of 28 July 2016 on the oversight of payment schemes (

text: ) Introduction and legal basis

text: On 24 May 2016 the European Central Bank (ECB) received a request from the Polish Ministry of Finance for an opinion on a draft law amending the Law on Payment Services and certain other laws (hereinafter the ‘draft law’). The ECB understands that since the draft law was sent to the ECB for consultation a more recent version thereof has become available on the Polish Parliament’s website. The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the Functioning of the European Union and the third and fifth indents of

text: , as the draft law relates to Narodowy Bank Polski (NBP) and payment and settlement systems. In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council has adopted this opinion.

text: 1. Purpose of the draft law

text: 1.1 The main purpose of the draft law is to adapt the national legal framework governing card-based payment transactions to

text: Regulation (EU) 2015/751

text: of the European Parliament and of the Council , which requires the Member States to designate competent authorities that are empowered to ensure enforcement of the Regulation and to lay down rules on penalties applicable to infringements thereof. Accordingly, the draft law, by way of an amendment to the Law on Payment Services, designates the President of NBP (hereinafter the ‘President’) as the competent authority for the enforcement of

text: Regulation (EU) 2015/751

text: in respect of payment card schemes. 1.2 In addition, the draft law aims at strengthening NBP’s oversight role in the area of payment schemes by extending its oversight powers not only to card-based payment schemes but to all payment schemes active in Poland. The draft law also extends the scope of the prudential supervision function of Komisja Nadzoru Finansowego (KNF, The Polish Financial Supervisory Authority) in accordance with the Regulation. 1.3 The draft law introduces a new chapter in the Law on Payment Services which includes provisions prescribing the type of action that may be undertaken by the President in carrying out the new

text: tasks as the competent authority for the oversight of payment schemes. In particular, the President will be responsible for: (i) issuing an operating licence and approving any changes to the rules governing the functioning of payment schemes; (ii) assessing the functioning of payment schemes; (iii) collecting and requesting information and documents necessary to perform such assessment; (iv) issuing recommendations; and (v) suspension or revocation of the licence. The new chapter includes the rules on payment schemes and the licensing process relating to them. The draft law also provides that the Minister responsible for financial institutions, after consulting the President, must specify by regulation the criteria for the assessment of a payment scheme and the information and documents required for an application for a licence. 1.4 Furthermore, the draft law introduces provisions that complement the rules on cooperation between NBP and KNF in the field of supervision of national payment institutions providing acquiring services. In particular, KNF will be obliged to inform the President of any changes that may have an impact on the accuracy of the information and documents to be included in a licence application submitted by such a payment institution, to the extent that they may have an impact on the manner in which an acquiring service is provided. In addition, if the President becomes aware that the activities of a payment institution could threaten the stability of the payment system they will have to inform KNF thereof. 1.5 The draft law specifies the scope of the opinion that the President has to provide before KNF issues a licence to a national payment institution. The opinion must include an assessment of the application as it relates to the legality, safety and efficiency of the payment service. The draft law also prescribes that the opinion must be provided within one month of delivery of the application by KNF. 1.6 The draft law provides that a licence for the operation of a payment scheme or the consent of the President to a change in the rules of a payment scheme will not be required (i) in the case of threeparty payment schemes (i.e. schemes where the governance authority is an issuer of a payment instrument and the only provider of acquiring services) and (ii) if the rules of a payment scheme operating on Polish territory have been assessed by the appropriate oversight authority of another Member State or of the Union. In the latter case, the draft law requires the payment scheme’s governance authority to provide specified information to the President before operating the scheme on Polish territory. However, if the President finds that the rules of the payment scheme do not ensure the sufficient safety or efficiency of the payment scheme or the infrastructure, payment systems and/or payment schemes with which the payment scheme is affiliated, the payment organisation may be required by the President to apply for the above-mentioned licence/consent. The draft law also provides that in both cases where the payment scheme is a payment card scheme (as defined in

text: Regulation (EU) 2015/751

text: ) then the payment card scheme’s governance authority is required to provide the President with information confirming that the payment card scheme is compliant with the requirements laid down in

text: Regulation (EU) 2015/751

text: , at least two months before the planned commencement date for the operation of the payment card scheme on Polish territory. A payment card scheme may start operating on Polish territory unless the President finds that the payment card scheme does not comply with the requirements set out in

text: Regulation (EU) 2015/751

text: , within two months of the abovementioned information being sent. In

text: respect of payment schemes already operating in Poland on the day of the entry into force of the draft law, there is a grace period of six months to submit the application for a licence to the President for the operation of the payment scheme or, in the case of a scheme previously assessed by the appropriate oversight authority of another Member State or of the Union, to submit the documentation confirming the results of the previous assessment. Such a scheme is permitted to continue its operation until the application is assessed or the documentation is reviewed, as applicable. 1.7 The draft law further provides that the President may, in particular, issue a decision on a temporary, partial or total suspension of a payment scheme, including a three-party payment scheme and a card payment scheme operating on Polish territory which has been assessed by the appropriate oversight authority of another Member State or of the Union, or withdraw the consent for the functioning of such payment schemes. The President must inform the relevant oversight authority about such a decision. 1.8 Finally, the draft law also amends certain other laws which govern the oversight of other segments of the financial market infrastructure, such as payment systems, securities settlement systems and providers of acquiring services. The changes mainly reflect recent Union and international oversight standards and provide the President with stronger oversight tools (e.g. the introduction of additional requirements regarding provision of information for the entities operating financial market infrastructures).

text: 2. Scope of the opinion

text: This opinion focuses on the oversight of payment schemes by NBP (Section 3) and the new oversight tasks conferred on NBP in relation to the prohibition of monetary financing under Article 123 of the Treaty (Section 4).

text: 3. Oversight of payment schemes

text: 3.1 The ECB understands and welcomes that the draft law aims to strengthen and provide a sound regulatory basis for NBP’s oversight role in the area of payment schemes, to ensure a safer and more efficient functioning of these schemes. 3.2 It is noted that the definition of ‘payment scheme’ in the draft law appears to include not only cardbased payment schemes, but covers a wider set of payment schemes. The ECB understands that the main aim of the legislator is to focus on the issuing and acquiring aspect of payment instruments, such as cards and mobile payments. The ECB also understands that it is not intended for the definition of ‘payment scheme’ to be interpreted as also covering the Single Euro Payments

text: Area (SEPA) schemes for direct debits (SDD) and credit transfers (SCT), as well as national (non- SEPA) credit transfer and direct debit schemes . 3.3 The ECB notes that the draft law only exempts three-party payment schemes from the requirement to obtain a licence from or the consent of the President, but that the other powers of the President still apply, including the power to issue recommendations on such a payment scheme and to suspend it from operation in Poland. However, in the case of payment service providers from other Member States, such powers may conflict with the actions of the national competent authorities of the home Member State responsible for the supervision of providers of issuing and acquiring services within a payment scheme. They may also conflict with the right of establishment and the freedom to provide services which payment institutions, e-money institutions or credit institutions should enjoy when providing issuing and acquiring services in a host Member State. 3.4 The Eurosystem oversight policy framework provides that for the purpose of overseeing individual systems, it will assign a leading role to the central bank that is best placed to fulfil this function. For systems with a clear national anchor in Poland, NBP will perform this role and the draft law would provide a sound legal basis to support NBP’s role as lead overseer. However, where there is no national anchor, the ECB Governing Council may assign the primary oversight responsibilities to the ECB, with participation of other interested national central banks (NCBs) in the Eurosystem as part of a cooperative oversight arrangement. This is the case for the SCT and SDD schemes, as well as the Visa and American Express card payment schemes. There are also cooperative oversight arrangements in place in relation to the MasterCard card payment scheme, where the Nationale Bank van Belgiё/Banque Nationale de Belgique has been assigned as the lead oversight authority (with the ECB and some volunteering NCBs also involved in the arrangement). The ECB welcomes that the draft law aims to also exempt a payment scheme operating on Polish territory, which has been assessed by the appropriate oversight authority of another Member State or of the Union, from the requirement to obtain a licence from the President for the operation of a payment scheme or to obtain the President’s consent to a change in the rules of a payment scheme. The ECB understands that the President’s power to nevertheless require such a payment scheme to obtain the relevant licence/consent would, in practice, only be exercised in cases where the final assessment by the appropriate oversight authority of another Member State or of the Union was negative and that, in any event, NBP would cooperate with the relevant oversight authority until the conclusion of an oversight assessment and not take any unilateral action based on preliminary assessment findings. However, the draft law would benefit from making it clear that the President’s power will not conflict with any action taken by the Eurosystem. Similarly, the provisions of the draft law providing for the possibility that the President may suspend a payment scheme or withdraw consent for its functioning could be clarified to ensure that the exercise of the President’s oversight powers, in relation to payment schemes that are already subject to Eurosystem oversight, will not conflict with action taken by the NCBs as part of a cooperative oversight arrangement. The ECB

text: therefore suggests that payment schemes in respect of which a leading oversight role has already been assigned to the ECB and/or one or more NCBs, be excluded from the scope of the President’s oversight powers, so that the draft law essentially relies on cooperative oversight arrangements with the ECB and the NCBs. In this respect, it is noted that NBP is entitled to participate in the Eurosystem assessment groups on the basis of the contractual arrangements in place with the Eurosystem oversight authorities for international card payment schemes. If such an approach is followed, this would mean increased pan-European harmonisation and efficiency in the provision of card payments. 3.5 As a general matter, the Polish authorities may also wish to further consider whether the imposition of the abovementioned specific requirements on payment schemes established and legally operating in other Member States is compliant with the Treaty provisions on the free movement of services and other applicable provisions of EU law. 3.6 In relation to the SCT and SDD schemes, whilst the ECB understands that the draft law intends to exclude credit transfer and direct debit schemes from the scope of NBP’s oversight, the drafting of the relevant exclusion could be more accurately formulated. In particular, the relevant provision of the draft law provides that the chapter dealing with NBP oversight does not apply to payment schemes in so far as they are subject to the rules of assessment under

text: Regulation (EU) No 260/2012

text: of the European Parliament and of the Council (hereinafter the ‘SEPA Regulation’) . However, the rules applicable to oversight assessment at Eurosystem level are set out in the oversight policy framework and related guides , not in the SEPA Regulation. The latter requires Member States to establish competent authorities responsible for ensuring compliance with the SEPA Regulation, but the key role of these authorities is to monitor compliance by the payment service providers rather than carry out assessments of payment schemes. In these circumstances, the ECB invites the consulting authority to consider reformulating the relevant exclusion by providing that the chapter dealing with NBP oversight does not apply to payment schemes for the execution of payment transactions regulated by the SEPA Regulation. 3.7 Regarding the exercise of the President’s oversight powers over domestic payment schemes, the ECB notes that the regulations to be issued by the Minister responsible for financial institutions will specify the criteria for the assessment of a payment scheme. In the interests of harmonisation, the ECB suggests that these criteria should be aligned with the criteria established under the Eurosystem oversight policy framework.

text: 4. Conferral of new tasks on NBP

text: 4.1 General observations

text: 4.1.1 The draft law assigns the new oversight task to the President, since the President is the only NBP organ that may, under the Law on Narodowy Bank Polski, issue administrative decisions. The ECB understands that this new oversight task is, in effect, to be conferred on NBP and that the President will act on behalf of NBP. 4.1.2 The ECB would like to recall that when new tasks are conferred on a member of the European System of Central Banks (ESCB), it is necessary to assess these tasks against the prohibition of monetary financing under Article 123 of the Treaty. For this purpose, the ECB has developed guidance, in the form of general and specific considerations as set out in paragraph 4.2, on the basis of which the ECB may decide whether the new task conferred on an ESCB national central bank (NCB) is to be considered a central banking task or a governmental task for the purposes of assessing the conferral of such a task against the prohibition of monetary financing . This guidance applies to genuinely new tasks that either did not exist in the past or did not form an integral part of the central banking tasks previously assigned to the NCB in question. The tasks currently discharged by an NCB as central banking tasks are not reviewed and re-categorised, but may be reassessed if they are subject to substantive legislative amendments. In this regard, the ECB notes that the President already exercises oversight in respect of certain segments of the financial market infrastructure. The draft law, however, extends NBP’s oversight powers to include payment schemes and the new tasks should therefore be assessed for compliance against the monetary financing prohibition. The concrete assessment of whether NBP’s tasks as the authority responsible for oversight of payment schemes is to be considered a central banking task or a governmental task is undertaken in paragraph 4.3. 4.2 Guidance on conferral of new tasks 4.2.1 First, the principle of financial independence requires that the Member States may not put their NCBs in a position where they have insufficient financial resources to carry out their ESCB- or Eurosystem-related tasks, as applicable. Second, central banking tasks comprise in particular those tasks that are related to the tasks listed in

text: Article 127(2)

text: , (5) and (6) of the Treaty. Third, new tasks conferred on an NCB that are atypical of NCBs’ tasks, or which are clearly discharged on behalf of and in the exclusive interest of the government or of other public entities, should be considered as governmental tasks. 4.2.2 An important criterion for qualifying a new task as a governmental task is therefore the impact of the task on the institutional, financial and personal independence of the NCB. In particular, the following should be taken into account. First, it should be assessed whether the performance of the new task creates inadequately addressed conflicts of interests with existing central banking tasks, and does not necessarily complement those existing central banking tasks. If a conflict of interest arises between existing and new tasks, there should be sufficient mitigation in place to adequately address that conflict.

text: Complementarity between the new task and existing central banking tasks should not, however, be interpreted extensively, so as to lead to the creation of an indefinite chain of ancillary tasks. Complementarity should also be examined from the point of view of the financing of those tasks. Second, it should be assessed whether without new financial resources the performance of the new task is disproportionate to the financial or organisational capacity of the NCB and may negatively impact on its capacity to properly perform existing central banking tasks. Third, it should be assessed whether the performance of the new task fits into the institutional setup of the NCB in the light of central bank independence and accountability considerations. Fourth, it should be assessed whether the performance of the new task would entail substantial financial risks. Fifth, it should be assessed whether the performance of the new task exposes the members of the NCB’s decision-making bodies to political risks which are disproportionate and may also impact on their personal independence and, in particular, the guarantee of the term of office under Article 14.2 of the Statute of the European System of Central Banks and of the European Central Bank. Any final assessment on the qualification of a task given to an NCB as either falling within the scope of a central banking task or a governmental task will be guided by the objective of ensuring the consistent application of the prohibition of monetary financing within the Eurosystem and the ESCB to the extent that it applies to its members. 4.3 Specific observations 4.3.1 Principle of financial independence The principle of financial independence requires that the Member States may not put their NCBs in a position where they have insufficient financial resources to carry out not only their ESCB-related tasks, but also their national tasks, both from an operational and financial perspective . 4.3.2 Links to tasks listed in

text: Article 127(2)

text: , (5) and (6) of the Treaty The oversight of payment schemes is a task related to the tasks conferred in the fourth indent of Article 127(2) of the Treaty, as this task is ancillary to the promotion of the smooth operation of payment systems. 4.3.3 Atypical tasks Central banks have always had an interest in the safety and efficiency of payment and settlement systems. In particular, as noted in Section 3 above, the ECB together with the Eurosystem NCBs carries out oversight activities in relation to payment schemes. In addition, the President already exercises oversight in respect of certain financial market infrastructures. The extension of NBP’s oversight powers to payment schemes can therefore be regarded as not atypical of a central bank. 4.3.4 Extent to which conflicts of interest with existing tasks are addressed Given that the President already exercises oversight in respect of certain segments of the financial market infrastructure, the extension of NBP’s oversight powers to payment schemes appears to

text: complement NBP’s existing powers and there should be no conflict of interest between the new and existing tasks of NBP. 4.3.5 Extent to which the performance of the new task is proportional with NBP’s financial and operational capacity and its ability to perform ESCB-related tasks The ECB understands that the extension of the scope of the oversight to payment schemes should not entail a substantial additional operational or financial burden for NBP. The ECB also understands that NBP already undertook necessary measures to ensure resources for the performance of the extended oversight duties. 4.3.6 Extent to which the performance of the new task fits into the institutional set-up of NBP in the light of central bank independence and accountability considerations Given the complementarity of the new tasks with NBP’s existing oversight powers in respect of other segments of the financial market infrastructure, the new tasks appear to fit into the current institutional set-up of NBP. 4.3.7 Extent to which the performance of the new task entails financial risks The draft law does not contain any specific provisions on liability. The ECB understands that the performance of the new task does not involve the risk of any additional liability other than that to which NBP is already subject to in performance of its other duties, according to which damage resulting from NBP’s unlawful act would need to be established in order to hold NBP liable. 4.3.8 Conclusion Given the close link to and complementarity with one of the principal functions of central banks of promoting the smooth operation of payment systems, the new tasks conferred on NBP are regarded as central banking tasks for the purposes of assessing their compliance with the monetary financing prohibition.

text: Done at Frankfurt am Main, 28 July 2016.

text: [signed]

text: The President of the ECB

text: Mario DRAGHI


text: Council Decision 98/415/EC of 29 June 1998

text: on the consultation of the European Central Bank by national authorities regarding draft legislative provisions (OJ L 189, 3.7.1998, p. 42).

text: See Opinion

text: . All ECB opinions are available on the ECB’s website at www.ecb.europa.eu.

text: For further information on lending in foreign currencies in the Union see the Annex to Recommendation

text: of 21 September 2011 on lending in foreign currencies (OJ C 342, 22.11.2011, p.1).

text: See paragraph 2.2 of Opinion

text: , paragraph 2.1 of Opinion

text: and paragraph 2.1 of Opinion

text: See NBP Monetary and financial statistics report at http://www.nbp.pl/en/statystyka/czasowe_dwn/nalez_zobow_banki_en.zip.

text: Directive

text: of the European Parliament and of the Council of 4 February 2014 on credit agreements for consumers relating to residential immovable property and amending Directives

text: and

text: and

text: Regulation (EU) No 1093/2010

text: (OJ L 60, 28.2.2014, p. 34).

text: See paragraph 3.2 of Opinion

text: , paragraph 2.2 of Opinion

text: and paragraph 3.2.1 of Opinion

text: See paragraph 3.2.2 of Opinion

text: See paragraph 3.3 of Opinion

text: See paragraphs 3.3.1 and 3.3.2 of Opinion

text: Risks associated with blanket currency conversion of foreign exchange loans at the exchange rate prevailing on the loan origination have been discussed and analysed by the National Bank of Poland in the Financial Stability Review July 2015. See http://www.nbp.pl/en/systemfinansowy/fsr201507.pdf, Box 2 on p. 39-41.

text: See paragraph 3.4 of

text: and paragraph 3.3 of

text: See paragraph 3.2.3 of

publisher: Europeiska centralbanken

sprak: en

title: Opinion of the European Central Bank of 29 July 2016 on specific rules for restructuring loans indexed or denominated in foreign currency (CON/2016/39)

serie: con

text: OPINION OF THE EUROPEAN CENTRAL BANK of 29 July 2016 on specific rules for restructuring loans indexed or denominated in foreign currency (

text: ) Introduction and legal basis

type: rubrik

text: On 15 June 2016 the European Central Bank (ECB) received a request from the Polish Parliament for an opinion on a draft law establishing specific rules for the restructuring of loans denominated or indexed to a currency other than the Polish zloty. An updated version of the draft law (hereinafter the ‘draft law’) was received on 11 July 2016. The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the Functioning of the European Union and the sixth indent of

text: Article 2(1) of Council Decision 98/415/EC

text: , as the draft law contains rules applicable to financial institutions insofar as they materially influence the stability of financial institutions and markets. In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council has adopted this opinion.

type: stycke

text: 1. Purpose of the draft law

text: 1.1 The purpose of the draft law is to facilitate the restructuring of loans denominated or indexed in a foreign currency (hereinafter ‘foreign currency loans’) that were granted after 1 January 2000 for a period exceeding 60 months, even if such loans have been repaid in full or terminated and settled. The draft law also prohibits granting of any future loans involving settlement in a foreign currency. 1.2 Under the draft law, all borrowers that are consumers or other natural persons are entitled to request the restructuring of their loans. Restructuring is subject to the following rules: (i) Any contractual obligation of the borrower denominated in a foreign currency or indexed to a foreign currency is deemed to be null and void; (ii) The principal amount of the loan is the amount in Polish zloty (PLN) actually paid to the borrower. Based on the explanatory memorandum, the ECB understands that the exchange rate used to convert the principal amount will be the exchange rate applicable on the date the amount is paid to the borrower; (iii) The interest rate on the loan, which will for each interest period comprise the base rate and the margin, is determined based on the following rules: (a) the margin is equal to the level set in the loan agreement but must not be higher than 4 %, (b) the base rate for each interest period is equal to the reference rate of Narodowy Bank Polski (NBP) in

text: force on the first day of a given period, and (c) the interest rate must not exceed 30 % of the margin set out in the loan agreement for the entire settlement period (before and after the restructuring); and (iv) The amount of any fees, commissions, insurance premiums and other costs which the borrower is obliged to pay and which are denominated in or indexed to a foreign currency is set based on the exchange rate applicable on the date of their payment to the lender. 1.3 The draft law provides that any loan repayments made prior to the date on which the borrower notifies the lender of his/her intention to restructure the loan will be credited towards the repayment of the loan following its restructuring. If the borrower has made repayments in a foreign currency, the amount repaid will be calculated based on the exchange rate used by the bank on the date of payment. If the loan was repaid in Swiss francs (CHF), the lender’s purchase rate on that date will be used for the purposes of the calculation. 1.4 According to the draft law, if the total amount of repayments made prior to the date on which the borrower notifies the lender of his/her intention to restructure the loan is lower than the total amount of repayments due following the restructuring, the difference between these amounts will increase the borrower’s debt. Conversely, if the total amount of repayments is higher, the difference between the amounts will reduce the borrower’s debt. 1.5 Furthermore, if, following the restructuring, the repayment instalments would be at least 10 % higher than the first loan instalment, the borrower may extend the loan repayment term by the period necessary for the loan instalments to no longer exceed the pre-restructuring loan instalments by more than 10 %. Any such extension is for a maximum period of 10 years. 1.6 The draft law also provides that the lender may not amend any other term of the loan agreement in connection with the restructuring. 1.7 As regards the application procedure, the draft law provides that the borrower may notify the lender of its intention to restructure his/her loan within two years of the entry into force of the draft law. Following such notice, the lender will have 30 days to notify the borrower of the following: (i) the total amount of loan instalments due in the period between the date on which the loan was granted up to the notification date, (ii) the total amount of loan instalments paid by the borrower, (iii) the level of the borrower’s debt following the restructuring, (iv) the interest rate on the loan following the restructuring and (v) the loan repayment schedule following the restructuring for the next 12 months. The borrower may apply to have his/her loan restructured within two months of receiving the above information from the lender. If the borrower contests the correctness of the information provided by the lender, he/she may within one month request that the Financial Ombudsman, through mediation, determines the rules for the loan restructuring. Where no agreement can be reached following such mediation, the borrower may request that the court determines the rules for the loan restructuring. 1.8 With regard to any loans that have been repaid in full, the draft law provides that, if the lender’s calculation of the loan following the restructuring indicates that the borrower has overpaid an amount, the lender must return any overpayment to the borrower within 30 days of the borrower’s request.

text: 1.9 With regard to any loans that have been terminated, within 30 days of the borrower’s request, the lender must notify the borrower of the information set out in paragraph 1.7 as well as of the loan repayment arrears outstanding on the date the loan was terminated. If requested by the borrower, the loan is restructured and the previous termination of the loan agreement becomes null and void. The restructured principal amount of the loan is increased by 1 % of the arrears. 1.10 The draft law also provides that if the lender has caused the borrower to suffer a loss, he/she must remedy such loss or reinstate the state of affairs that existed on the date the loan agreement was entered into. 1.11 Under the draft law, the borrower is entitled to refer any doubts concerning mutual settlements and terms of the restructuring for verification, determination and assessment by a civil court. The draft law prescribes that the court’s decision must not include restructuring terms which are worse than those included in the information provided by the lender. 1.12 In addition, the draft law provides that the loan restructuring entitles the borrower to apply for the removal of the current mortgage securing the loan and its replacement by a new mortgage over the same real estate for the amount of the restructured loan plus 20 %. 1.13 The draft law amends the provisions of the Banking Act of 29 August 2007 by inserting, among other things, a provision pursuant to which borrowers that are consumers are entitled to discharge all of their debt arising from a loan secured by a mortgage over real estate by transferring the ownership of the real estate to the lender who is bound to purchase it. 1.14 Finally, the draft law provides that any bank enforcement titles concerning claims arising under loans denominated in or indexed to foreign currencies become void. 1.15 The draft law is to enter into force after one month following the date of its publication.

text: 2. General observations

text: 2.1 The ECB notes that it has previously been consulted by the Polish Parliament and commented on a draft proposal, which was not adopted subsequently, dealing with the restructuring of foreign currency home loans . The ECB also understands that various other proposals dealing with the conversion of foreign currency loans are currently being discussed by the Polish authorities. The current opinion relates only to the draft law submitted to the ECB on 15 June 2016. 2.2 Prior to the global financial crisis, borrowing in foreign currencies by households and non-financial 3 4 corporations was popular in several Member States . As previously noted by the ECB , the lower interest rates applicable to foreign currency loans compared to loans in the domestic currency, as well as the expectation of domestic currency appreciation, increased the demand for such loans. Most of the foreign currency loans in Poland are housing loans denominated in CHF. Foreign

text: currency housing loans constituted approximately 43 % of all outstanding housing loans and 26 % of all outstanding loans to households in May 2016 .

text: 3. Specific observations

text: 3.1 Retroactivity 3.1.1 Acknowledging that Directive

text: of the European Parliament and of the Council does not apply to credit agreements existing before 21 March 2016, as previously noted by the ECB , the retroactive effect of the draft law does not seem to be in line with the general aim and principle of

text: Article 23(5) of Directive 2014/17/EU

text: . This Directive allows Member States to further regulate foreign currency loans, on the condition that such regulation is not applied with retroactive effect. 3.1.2 As previously noted by the ECB , introducing measures with retroactive effect could in principle undermine legal certainty and might not be in line with the principle of legitimate expectations. It is however for the Polish authorities to assess whether the retroactive character of the draft law complies with the applicable principles under Polish law, including the Polish Constitution. 3.2 Eligibility criteria The ECB notes that the draft law does not prescribe any eligibility criteria for borrowers applying for loan restructuring other than specifying that borrowers must be consumers or other natural persons. As noted previously , this raises concerns with regard to the purpose of the draft law. In particular, the application of certain targeted eligibility criteria such as, for example, linking the right to convert to the borrower’s actual income position or to the loan-to-value (LTV) ratio may be appropriate. 3.3. Effects on the banking sector, financial stability and Polish economy. 3.3.1 The ECB reiterates its comments regarding risks associated with foreign currency loans made in a previous opinion . In particular, in the case of Poland, such risks do not, at present, appear to be of a systemic nature for the financial system and are not seen as representing a particular risk from a financial stability perspective. 3.3.2 The ECB notes that the implementation of the draft law is expected to entail financial costs for the banking sector. Whilst the explanatory memorandum does not present a comprehensive assessment of the impact of the draft law, the ECB is of the view that the conversion of foreign currency loans at the exchange rate prevailing on the loan origination date, as anticipated by the draft law, may have a significant impact on the financial stability of the Polish banking sector, which could result in substantial losses and reduced capital buffers. Banks need to take into account the

text: direct costs of conversion as well as any costs relating to the closing of currency positions due to the unwinding of existing hedges and refinancing. This would reduce the resilience of the financial sector to adverse shock and may have a further negative impact on the Polish economy, in particular due to the possibility of a strong depreciation of the PLN . 3.3.3 The draft law may also have some negative effects on the Polish economy if it leads to a deterioration in foreign investor sentiment due to a perceived increase in legal uncertainty and country risk. 3.3.4 In addition, the ECB notes that the proposed interest rate for the restructured loans, which is to be composed of NBP’s current reference interest rate and a restricted margin, is substantially below the usual pricing of collateralised, long-term non-mortgage loans, and could therefore have a further negative impact on the future profitability of the affected banks. 3.3.5 Whilst the conversion of foreign currency loans should reduce part of the currency mismatches in households’ balance sheets, which could provide relief for distressed foreign currency borrowers and contribute to reducing the credit risk of banks in the longer term, the potential overall negative impact of the draft law on the financial stability of the Polish banking sector and the future lending capacity of certain institutions may be significant, thus resulting in overall negative effects on the Polish economy. 3.3.6 Consequently, the ECB suggests that the Polish authorities carry out a thorough analysis as to whether the envisaged retroactive measures could have negative effects on the banking sector and the overall economy in Poland, in particular on the sound capital base and the internal capital adequacy assessment processes of the affected institutions, including cross-border effects on the consolidated profits of international banking groups, potentially leading to increased write-down requirements. With regard to any potential negative effects of such measures, the ECB remains of the opinion that, when introducing provisions in relation to settling and converting foreign currency loans, due consideration should always be given to fair burden sharing among all stakeholders, thus also avoiding moral hazard in the future . 3.3.7 From a banking supervisory perspective, as previously noted by the ECB , the restructuring of the foreign currency loans, as proposed by the draft law, does not eliminate all risks relating to such loans, in particular interest rate risks. 3.8 Miscellaneous 3.8.1 The ECB notes that the draft law contains provisions that are unclear, or may be interpreted very broadly and therefore give rise to legal uncertainty. For example, it is difficult to reconcile how the interest rate on the loan would comprise a base rate equal to the NBP reference rate and margin equal to the level set in the loan agreement (not higher than 4 %) with the specification that the interest rate must not exceed 30 % of the margin set out in the loan agreement for the entire settlement period (before and after the restructuring). Also, in the provision which requires the

text: lender to remedy ‘any loss’ incurred by the borrower it is not clear what is meant by a loss on the part of the borrower and what kind of liabilities might arise for lenders as a result of this provision. 3.8.2 The ECB also notes that the draft law prescribes that if the borrower refers his/her doubts concerning mutual settlements and the terms of the restructuring for verification, determination and assessment by a civil court, the court’s decision must not include restructuring terms which are worse than those included in the information provided by the lender. It might be useful to clarify more precisely what is intended by this provision. 3.8.3 Finally, the ECB notes that a temporary relief programme funded by the banks has recently been set up in Poland to assist borrowers in a difficult financial situation in meeting their foreign currency loan obligations. The Polish authorities might consider analysing the impact of this programme before introducing other measures dealing with foreign currency loans.

text: This opinion will be published on the ECB’s website.

text: Done at Frankfurt am Main, 29 July 2016.

text: [signed]

text: The President of the ECB

text: Mario DRAGHI

type: vagledning

utgivare: ecb


text: Council Decision 98/415/EC of 29 June 1998

text: on the consultation of the European Central Bank by national authorities regarding draft legislative provisions (OJ L 189, 3.7.1998, p. 42).

text: Regulation No 6/2002 of Banca Naţională a României regarding the minimum reserves regime, published in Monitorul Oficial al României, Part I, No 566 of 1 August 2002.

text: See Article 57 of Law No 312/2004 regarding the Statute of Banca Naţională a României, published in Monitorul Oficial al României, Part I, No 528 of 30 June 2004.

text: See paragraph 4 of the sole Article of the draft regulation, which amends Article 28(2) of the BNR Regulation. Article 57 of the Statute of BNR constitutes the general provision for the imposition of sanctions in case of a breach of the Statute and BNR regulations and decisions. In addition, in the area of minimum reserves, special provisions on sanctions are laid down in Article 8(4) of the Statute of BNR and Article 12 of the BNR Regulation, according to which BNR shall calculate and impose penalty interest, at a rate established by BNR, for the failure to hold the required reserves over the maintenance period. 6 See paragraph 5 of the sole Article of the draft regulation, which amends Article 29 of the BNR Regulation. 7 See, in particular, Article 19 of the Statute of the European System of Central Banks and the European Central Bank;

text: Council Regulation (EC) No 2531/98 of 23 November 1998

text: concerning the application of minimum reserves by the European Central Bank (OJ L 318, 27.11.98, p. 1);

text: Regulation (EC) No 1745/2003

text: of the European Central Bank of 12 September 2003 on the application of minimum reserves (ECB/2003/9) (OJ L 250, 2.10.2003, p. 10);

text: Regulation (EU) No 1071/2013

text: of the European Central Bank of 24 September 2013 concerning the balance sheet of the monetary financial institutions sector (ECB/2013/33) (OJ L 297, 7.11.2013, p. 14). 8 In the same vein, see Opinions

text: and

text: . 9 See, in this regard, paragraph 3.2 of Opinion

text: . On that occasion, the ECB also noted the differences at the time between the domestic minimum reserves regime and the Eurosystem’s minimum reserves framework.

title: Opinion of the European Central Bank of 30 August 2016 on amendments to the minimum reserves regime (CON/2016/40)

text: OPINION OF THE EUROPEAN CENTRAL BANK of 30 August 2016 on amendments to the minimum reserves regime (

text: ) Introduction and legal basis

text: On 29 July 2016 the European Central Bank (ECB) received a request from Banca Naţională a României (BNR) for an opinion on a draft regulation amending the BNR Regulation on the minimum reserves regime (hereinafter the ‘draft regulation’). The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the Functioning of the European Union and the third indent of Articles 2(1), and

text: Article 2(2) of Council Decision 98/415/EC

text: , as the draft regulation relates to a national central bank and instruments of monetary policy in a Member State whose currency is not the euro. In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council has adopted this opinion.

text: 1. Purpose of the draft regulation

text: 1.1 The draft regulation updates the legal framework governing the minimum reserves regime established by BNR (hereinafter the ‘BNR Regulation’) with a view to replacing references to certain repealed legal acts, replacing the legal basis for BNR’s power to take punitive action in the event of certain infringements of the BNR Regulation, and expanding the circumstances under which BNR may impose exceptional reserve requirements for a defined period of time with regard to certain credit institutions. 1.2 Under the draft regulation, certain infringements of the minimum reserves regime are no longer qualified as a breach of banking conduct but as a breach of a BNR regulation. Hence, such infringements are no longer subject to the sanctioning regime under the banking law, but instead to the sanctioning regime under the Statute of BNR . As a consequence, where a credit institution (i) repeatedly fails to report or misreports the reserve base and data for the calculation of the average interest rate on demand deposits, or (ii) modifies accounting operations and/or statistical data in order to decrease its minimum reserves, BNR may impose the following sanctions : (a) a written

text: warning; (b) a fine from 500 to 5 000 Romanian lei; (c) partial or total suspension of the authorisation granted by BNR for a period of up to 90 days; and (d) withdrawal of the authorisation granted by BNR. 1.3 Furthermore, according to the draft regulation, where a credit institution fails to hold the required minimum reserves for two consecutive maintenance periods, BNR may carry out an on-site inspection at the institution’s headquarters. In addition, should the failure to hold the required minimum reserves occur more than twice within a 12-month period, BNR may impose any of the sanctions provided by the Statute of BNR for breach of a BNR regulation as listed in paragraph 1.2 . 1.4 The draft regulation also amends the provision that lays down the circumstances under which BNR may establish exceptional reserve requirements, for a defined period of time, with regard to certain credit institutions. The application of an exceptional regime, which includes exemptions from penalty interest payments and the exclusion of certain liabilities from the reserve base, is subject to approval by the BNR’s Board. It may be applied on a case-by-case basis with regard to credit institutions subject to crisis prevention or crisis management measures, as well as in any other exceptional situations justified by objective considerations where the purpose of imposing minimum reserves requirements would not be met . In this regard, the explanatory memorandum to the draft regulation notes that the said amendment aims to enable BNR to apply, for a defined period, ‘derogatory’ reserves requirements in respect of certain liabilities with residual maturity over two years with a view to supporting an adequate capitalisation of credit institutions.

text: 2. General observations

text: The ECB welcomes BNR’s initiative to update the legal framework governing the minimum reserves regime. As a Member State whose currency is not the euro, Romania retains its powers in the field of monetary policy according to national law until such time as the relevant derogation is lifted and Romania adopts the euro. This notwithstanding, it is beneficial to achieve consistency with the Eurosystem’s minimum reserves framework so that credit institutions become acquainted with the reserves requirements that will apply to them following the adoption of the euro in the Member State where they are established . To that end, BNR should already give consideration to gradually bringing its regulations in this field in line with Eurosystem standards .

text: 3. Specific observations

text: 3.1 Sanctions in the event of certain infringements The ECB noted in an earlier opinion that, under the Romanian minimum reserves regime, the sanctions in cases of non-compliance are considerably more severe than those provided for under the Eurosystem’s minimum reserves framework. Following the amendments proposed under the draft regulation, the sanctioning regime applied to credit institutions failing to comply with obligations imposed upon them by BNR becomes even more severe. Thus, pursuant to the amended Article 28(2) of the BNR Regulation, the sanctions that BNR is empowered to apply for the failure to hold the required minimum reserves more than twice within a 12-month period are no longer confined to warnings, fines and levying a penalty interest, but also include partial or total suspension of an authorisation for a period of up to 90 days as well as withdrawal of an authorisation. In contrast, for the same type of infringements, the Eurosystem’s minimum reserves framework provides for periodic penalty payments only . The ECB invites the consulting authority to ensure that the sanctions applied under the BNR Regulation are proportional and suitable for the purposes of minimum reserves requirements. 3.2 Exceptional reserve requirements The ECB understands that the amendment to Article 29 of the BNR Regulation aims to enable BNR’s Board to apply an exceptional minimum reserves regime to credit institutions which may temporarily face difficulties in meeting their capital requirements. In this regard, the ECB cautions against setting temporary tailor-made reserve requirements for certain credit institutions. Any exemptions from the obligation to hold certain minimum reserves should be established based on clear criteria and the principle of non-discrimination. From this perspective, it is noted that pursuant to the draft regulation the application of the exceptional regime has to be decided on objective grounds. However, it is not clear what are these ‘exceptional circumstances’, other than crisis prevention or crisis management, that may be considered by BNR’s Board in taking such a decision.

text: Done at Frankfurt am Main, 30 August 2016.

text: [signed]

text: The President of the ECB

text: Mario DRAGHI


title: Opinion of the European Central Bank of 31 August 2016 on the Banca d’Italia's circular implementing the reform of Italian cooperative banks (CON/2016/41)

text: OPINION OF THE EUROPEAN CENTRAL BANK of 31 August 2016 on the Banca d’Italia's circular implementing the reform of Italian cooperative banks (

text: ) Introduction and legal basis

text: On 21 July 2016, the European Central Bank (ECB) received a request from the Banca d’Italia for an opinion on draft circular No 285 implementing the reform of banche di credito cooperativo (BCCs, ‘Italian cooperative banks’) (hereinafter the ‘draft circular’). The draft circular follows the conversion of Decree- Law No 18 of 14 February 2016 into law, which amended Legislative Decree No 385/1993 (hereinafter the ‘Consolidated Law on banking’) . The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the Functioning of the European Union, and the third and sixth indents of

text: Article 2(1) of Council Decision 98/415/EC

text: , as the draft circular relates to the specific tasks conferred upon the ECB concerning the prudential supervision of credit institutions, the Banca d’Italia and rules applicable to financial institutions insofar as they materially influence the stability of financial institutions and markets. In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council has adopted this opinion.

text: 1. Purpose of the draft circular

text: 1.1 The purpose of the draft circular is to implement

text: Articles 37

text: -bis and 37-ter of the Consolidated Law on banking concerning cooperative banking groups. 1.2 The draft circular defines the structure of a cooperative banking group and lays down conditions that must be fulfilled by the cooperative banking group members. Under the draft circular, a cooperative banking group is composed of: (a) a parent bank; (b) BCCs that have entered into a cohesion contract; and (c) other banks that are not BCCs, and financial and ancillary services undertakings controlled by the parent bank. Under the draft circular, the parent bank is the sole entity that may exercise the powers of direction and coordination over the affiliated banks and is responsible for ensuring stability and sound and prudent management of the cooperative banking group. The activities falling within the sole responsibility of the parent bank shall not be outsourced or delegated.

text: 1 See Opinion

text: . All ECB opinions are available on the ECB’s website at www.ecb.europa.eu.

text: Council Decision 98/415/EC of 29 June 1998

text: on the consultation of the European Central Bank by national authorities regarding draft legislative provisions (OJ L 189, 3.7.1998, p. 42).

text: 3 See paragraph 2 of Section II, Chapter 2 and Section II, Chapter 3 of the draft circular. 1.3 In addition, a cooperative banking group may also include a local sub-group that includes a subholding bank based in a specific geographical area. This sub-holding bank supports the parent bank in the task of directing and monitoring the BCCs by giving the parent bank’s instructions to the BCCs. All entities of the sub-group, including the sub-holding bank, are subject to the parent bank’s powers of direction and coordination . 1.4 By entering into a cohesion contract, the BCCs join the cooperative banking group and agree to be subject to the parent company’s direction and coordination, powers and control. The parent company’s powers include: (a) issuing binding instructions to the affiliated banks and to the other companies of the cooperative banking group; (b) taking appropriate corrective actions if affiliated BCCs do not comply with the parent company’s instructions; and (c) issuing sanctions proportionate to the seriousness of the breach of contractual obligations in question. Compliance with the parent bank’s instructions in accordance with the cohesion contract is ensured by a system of controls and interventions over the affiliated banks, which is proportionate to their individual risk profiles . 1.5 The parent bank’s powers include: (a) corporate governance of the cooperative banking group and its members, including the procedures for appointing, removing and replacing the members of the management and control bodies of the affiliated banks; (b) internal control and IT systems; (c) control and intervention over the affiliated banks; (d) prudential requirements and reporting; (e) decisions of strategic relevance and (f) sanctions . 1.6 The draft circular requires the parent bank and the affiliated banks to enter into a cross-guarantee scheme, whereby the parent bank guarantees the liabilities of all affiliated banks and each affiliated bank guarantees the parent bank and the other affiliated banks for their own liabilities. The crossguarantee scheme has two dimensions. Firstly, the participating banks are jointly liable, within the limits of their individual obligations, for the liabilities of each participating bank that defaults on its creditors (external guarantee). Secondly, there is a mechanism of intra-group financial support by which the participating banks offer each other the financial support needed to ensure their solvency and liquidity, and, in particular, to comply with prudential requirements and satisfy requests by the competent authority. This mechanism also helps in avoiding resolution proceedings . 1.7 The draft circular also confers powers on the competent authority, i.e. the ECB or the Banca d’Italia, as the case may be, in line with

text: Council Regulation (EU) No 1024/2013

text: . In particular, the following decisions will not be effective or implemented until authorisation is granted by the competent authority: (a) withdrawal; (b) exclusion from the cooperative banking group; (c) admission or denial of admission to the cooperative banking group. The draft circular also

text: 4 Section II, Chapter 4 of the draft circular.

text: 5 Paragraphs 1, 3, 5 and 6 of Section III, Chapter 1 of the draft circular.

text: 6 Section III, Chapters 1.1 to 1.8 of the draft circular.

text: 7 Paragraphs 1 and 4 of Section III, Chapter 2 of the draft circular.

text: Council Regulation (EU) No 1024/2013 of 15 October 2013

text: conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutions (OJ L 287, 29.10.2013, p. 63). empowers the parent bank to instruct the affiliated banks to implement the competent authority’s instructions .

text: 2. General observations

text: 2.1 The ECB welcomes the fact that the draft circular provides for the parent bank to create the cooperative banking group under its powers of direction and coordination, which are specified in the cohesion contract between the parent bank and the affiliated cooperative banks. These specifications are aimed at ensuring that the cooperative banking group’s strategic direction and internal control systems are uniform, as well as ensuring that the cooperative banking group complies with prudential requirements applicable to it. 2.2 The ECB takes note of the powers conferred on the ECB as the competent authority by virtue of the draft circular, in line with

text: Regulation (EU) No 1024/2013

text: . 2.3 As noted by the ECB in a previous opinion , the establishment of a cooperative banking group involves significant challenges for the parent company in terms of risk governance and control systems. In particular, the ECB has emphasised that the parent company should be able to direct and coordinate the cooperative banking group, including by giving direct instructions to the affiliated banks under any circumstances to ensure compliance with applicable prudential rules and supervisory requirements as well as to ensure that the cooperative banking group entities’ operations and strategies are in line with the cooperative banking group’s policies and objectives. It is of great importance that cooperative banking groups have well-designed control functions, including risk management, compliance, internal audit and planning, and reporting exclusively to the parent company.

text: 3. Specific observations

text: 3.1 Under the draft circular, the parent bank performs the internal control functions on behalf of the affiliated banks by way of outsourcing arrangements, although maintaining adequately organised operational support units located at the biggest affiliated banks should be possible . However, since one of the main objectives of the reform is to more specifically set out the parent bank’s exclusive powers of direction and coordination over the affiliated banks, it would be useful to add an explicit clarification to this provision. Such clarification should indicate that the operational support units shall nevertheless be functionally dependent on, and subordinated to, the parent bank’s control functions. 3.2 The draft circular does not fully clarify the parent bank’s decision making powers with regard to granting loans over a certain amount. Consistently with the Italian regulatory framework on banking

text: 9 Section I Chapter 3; paragraph 5 of Section III Chapter 1; paragraph 5 of Section III Chapter 1.5; Section III Chapter 3.2; and paragraph 2 of Section IV Chapter 2 of the draft circular.

text: 10 See paragraphs 3.1.5 and 3.1.6 of Opinion

text: 11 First indent of paragraph 3 of Section III, Chapter 1.3 of the draft circular. groups , the draft circular should also provide for establishing a cooperative banking group-wide control system in respect of large transactions. In particular, the parent bank should be given specific powers to confirm loan transactions, whether in the form of a loan, guarantee or any other credit-granting instrument, that exceed a specific percentage of the affiliated bank’s own funds. Similarly, the parent bank should be empowered to approve transactions where the total exposure towards the same client or a group of connected clients is above predefined thresholds. 3.3 Under the draft circular the parent bank may stipulate in its by-laws for up to 50 per cent of the positions in its corporate bodies to be allocated to the directors and auditors of affiliated banks with a lower risk profile. The selection procedure for these positions is based on merit and takes into account the candidates’ previously demonstrated skills and the results achieved in managing the banks of the cooperative banking group. However, the draft circular does not mention key managers . The Banca d’Italia may wish to consider extending the merit-based part of the selection process to key function holders in the parent bank as well as the local sub-groups. Key function holders may be subject to additional rotation requirements in order to ensure their independence. 3.4 Under the draft circular, the parent bank has the power to provide instructions regarding management and evaluation of non-performing loans (NPLs) . The parent bank should manage directly the most important class of NPLs, i.e. the bad loans portfolio (sofferenze), which would provide several advantages. (a) It would enable the parent bank to develop an effective strategy for negotiating and carrying out bad loan disposals, including managing such bad loans after disposals take place, where relevant. (b) It would assist in developing a comprehensive, consistent and robust medium- and long-term management strategy for bad loans at the parent company level across the cooperative banking group. (c) It would provide guidance as regards separating the bad loan unit from the lending unit. 3.5 Under the draft circular, the parent bank and the affiliated banks must equip themselves with mechanisms to integrate IT systems and data management processes to ensure reliable and accurate risk measurement on an individual and consolidated basis . In this respect, a deadline for the implementation of a unified IT system should be introduced. In particular, the draft circular should be amended to ensure that cohesion contracts provide for a single IT system and data management process to be adopted within a reasonable period of time, but no later than three years from the date of entry into the cohesion contract. An adequate integration mechanism would

text: 12 See Articles

text: and

text: (b) and (d) of the Consolidated Law on banking, as implemented in Section V (internal controls) of Part I, Title IV, Chapter 3 and Section IV (large exposures) of Part II, Chapter 10 of the Banca d’Italia’s Circular No 285/2013; Chapter 5 (risk activities towards related entities) of Title V of the Banca d’Italia’s Circular No 263/2006.

text: 13 Second indent of paragraph 1 of Section III, Chapter 1.1 of the draft circular.

text: 14 Second indent of the last paragraph of Section III, Chapter 1.3 of the draft circular.

text: 15 Last paragraph of Section III, Chapter 1.4 of the draft circular. need to be adopted during the intermediate period to ensure reliability and accuracy of risk measurement on an individual and consolidated basis. 3.6 The draft circular confers on the parent bank the following powers and tasks: (a) monitoring and classifying risks to which the participating banks and the system as a whole are exposed; (b) powers of intervention; (c) conducting risk assessment and communicating the findings to the participating banks . The draft circular should specify that these powers and tasks are to be conducted by the parent bank annually, at a minimum, and more frequently, if required, due to an affiliated bank’s risk profile. 3.7 Under the draft circular, the cohesion contract gives the parent bank the power to: (a) issue instructions to the affiliated banks to ensure compliance with prudential requirements on a consolidated and individual basis; (b) define and adopt risk measurement methodologies for regulatory purposes; (c) set rules and criteria for the internal capital adequacy assessment process (ICAAP) that need to be applied by the affiliated banks at individual level; (d) implement instructions from the competent authority . In this respect, it is important that the draft circular requires the parent bank to establish uniform criteria for the stressed scenario to be applied by each BCC as part of the ICAAP . 3.8 The draft circular restricts the scope of the parent bank’s control over the affiliated banks, including its intervention and sanctioning powers. The oversight activity must be strictly linked to a set of predefined indicators, the results of the overall oversight activity, and the outcome of the previous intervention. These early warning indicators must refer to the following matters, at a minimum: own funds, credit risk, profitability, liquidity and fund raising . These provisions should further specify that this oversight function is built on a framework of progressive metrics under a ‘traffic light’ approach. The oversight function should be designed in a way that will prevent, to the greatest extent possible, the imposition of measures by the competent authority on an individual or consolidated basis. In particular, the oversight function should be based on a system of early warning and intervention or recovery indicators that would allow the parent bank to: (a) verify affiliated banks’ compliance with the instructions issued by the parent bank; (b) classify the level of risk to which the affiliated banks are exposed; (c) provide the grounds to uphold its corrective actions and sanctions imposed on the affiliated banks in accordance with the cohesion contract; (d) promptly provide appropriate measures of intra-group support as referred to in the crossguarantee scheme. 3.9 The draft circular outlines the administrative process that a bank intending to become a parent bank must follow in order to establish a cooperative banking group. If the new cooperative banking group qualifies as a significant supervised entity for the purposes of the Single Supervisory Mechanism, the Banca d’Italia only takes a decision regarding the application after having first

text: 16 First indent of the paragraph 5 of Section III, Chapter 2 of the draft circular.

text: 17 Paragraph 3 of Section III Chapter 1.5 of the draft circular.

text: 18 In accordance with Section II (internal capital adequacy assessment process) of Part I, Title III, Chapter 1 of the Banca d’Italia’s Circular No 285/2013. 19 Paragraphs 2 and 3 of Section III Chapter 1.4 of the draft circular. consulted the ECB . This should ensure that the ECB is able to fulfil its tasks specified in

text: Article 4(1) of Regulation (EU) No 1024/2013

text: . It is understood that this administrative process is without prejudice to the powers conferred on the ECB by

text: Council Regulation (EU) No 1024/2013

text: . Under that Regulation, the ECB is the competent authority responsible for authorising and withdrawing authorisations of credit institutions, taking up the business of a credit institution and ensuring compliance with Directive

text: of the European Parliament and of the Council , which requires credit institutions to have in place robust governance arrangements. 3.10 In order to exclude an affiliated bank from the cooperative banking group, the draft circular requires ‘the most severe circumstances’ to be present . However, in order to ensure legal certainty, the draft circular should contain more clearly specified requirements for such an exclusion. Moreover, there should be more specification as regards the requirement for the cohesion contract to refer to ‘serious violations ’. This opinion will be published on the ECB’s website. Done at Frankfurt am Main, 31 August 2016. [signed] The President of the ECB Mario DRAGHI

text: 20 Paragraph 3 of Section V Chapter 1 of the draft circular. 21 Directive

text: of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive

text: and repealing Directives

text: and

text: (OJ L 176, 27.6.2013, p. 338). 22 Section III, Chapter 1.7 of the draft circular. 23 Section III, Chapter 3.1 of the draft circular.


text: Council Decision 98/415/EC of 29 June 1998

text: on the consultation of the European Central Bank by national authorities regarding draft legislative provisions (OJ L 189, 3.7.1998, p. 42).

text: Regulation (EU) 2016/867

text: of the European Central Bank of 18 May 2016 on the collection of granular credit and credit risk data (ECB/2016/13) (OJ L 144, 1.6.2016, p. 44).

text: The legal bases for the statistical research carried out by Banka Slovenije are Article 13 of the Law on Banka Slovenije (Zakon o Banki Slovenije) (ZBS-1) (Ur. l. RS No 72/06 – official consolidated text, and 59/11) and Article 5 of the Statute of the European System of Central Banks and of the European Central Bank (hereinafter the ‘Statute of the ESCB’).

text: Zakon o varstvu osebnih podatkov (ZVOP-1) (Ur. l. RS No 94/07 – official consolidated text).

text: Zakon o bančništvu (ZBan-2) (Ur. l. RS No 25/15 and 44/16 ZRPPB).

text: Regulation (EU) No 575/2013

text: of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending

text: Regulation (EU) No 648/2012

text: (OJ L 176, 27.6.2013, p. 1).

text: Council Regulation (EC) No 2533/98 of 23 November 1998

text: concerning the collection of statistical information by the European Central Bank (OJ L 318, 27.11.1998, p. 8).

text: See paragraph 2.3 of Opinion

text: and paragraphs 2.4 and 2.5 of Opinion

text: . All ECB opinions are published on the ECB’s website at www.ecb.europa.eu.

text: See paragraph 2.1 of Opinion

text: Council Regulation (EU) No 1024/2013 of 15 October 2013

text: conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutions (OJ L 287, 29.10.2013, p. 63).

text: See Opinion

text: See the ECB’s 2016 Convergence Report, p. 25.

text: See recital 3 of Decision ECB/2014/6 of 24 February 2014 on the organisation of preparatory measures for the collection of granular credit data by the European System of Central Banks (OJ L 104, 8.4.2014, p. 72).

text: See

text: recital 1

text: of

text: Regulation (EU) 2016/867

text: See

text: recital 18

text: of

text: Regulation (EU) 2016/867

text: See, for example, Opinions

text: and

text: Regulation (EU) 2016/867

text: (ECB/2016/13) shall apply from 31 December 2017.

text: Article 26 of the Slovenian Constitution in conjunction with the Code of Obligations (Obligacijski zakonik) (OZ) (Ur. l. RS No 97/07 – official consolidated text).

title: Opinion of the European Central Bank of 31 August 2016 on a central credit register (CON/2016/42)

text: OPINION OF THE EUROPEAN CENTRAL BANK of 31 August 2016 on a central credit register (

text: ) Introduction and legal basis

text: On 29 July 2016, the European Central Bank (ECB) received a request from the Slovenian Ministry of Finance for an opinion on a draft law on the central credit register (hereinafter the ‘draft law’). The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the Functioning of the European Union and the third, fourth and sixth indents of

text: Article 2(1) of Council Decision 98/415/EC

text: , as the draft law relates to Banka Slovenije, the collection, compilation and distribution of financial and banking statistics, and the rules applicable to financial institutions insofar as they materially influence the stability of financial institutions and markets. In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council has adopted this opinion.

text: 1. Purpose of the draft law

text: 1.1. The draft law lays down the legal framework governing the establishment and operation of a central credit register (hereinafter, the ‘credit register’) and an electronic information exchange system (hereinafter, the ‘information exchange system’) by Banka Slovenije. The credit register will be a centralised collection of data concerning credit transactions with natural persons and business entities and concerning credit risks and other exposures in relation to business entities. The information exchange system, which is to form part of the credit register, constitutes an electronic system for the exchange of data and information relating to the indebtedness of business entities and natural persons. 1.2. The aims of the draft law are: (1) to facilitate the implementation of Banka Slovenije’s measures in the fields of monetary policy, macro-prudential supervision and ensuring financial stability; (2) to enable the effective management of credit risk; and (3) to renew the national reporting framework on credit and credit risk to ensure compliance with the framework laid down in

text: Regulation (EU) 2016/867

text: of the European Central Bank (ECB/2016/13) . 1.3. The management of the credit register by Banka Slovenije will include: (1) the standardised collection of data and information on credit transactions and other exposures; (2) the processing,

text: storage, analysis and dissemination of data for purposes of statistical research and in connection with other tasks and objectives of Banka Slovenije; and (3) ensuring the existence of a set of data relating to the indebtedness of business entities and natural persons in the information exchange system. 1.4. Under the draft law, Banka Slovenije will collect the data on credit and credit risk of business entities for the credit register from reporting units on the basis of standardised reporting. The data on the indebtedness of natural persons will be collected exclusively from the reporting units, which will at the same time also be members of the information exchange system. The draft law requires reporting units to report to Banka Slovenije data for the credit register on the first reference date for reporting. It also sets out rules on the scope of the collection and processing of data of natural persons and the applicable retention periods in respect of such data. Personal information contained in the credit register is to be processed in accordance with the requirements set out in the draft law and the Law on protection of personal data . 1.5. The draft law authorises Banka Slovenije to adopt implementing legislation on the scope, content and methods of collecting, processing, disseminating and transmitting the data and information of business entities to be held in the credit register. 1.6. The draft law also regulates the protection of the confidentiality of data in the credit register, as well as permissible uses and transmission of such data. 1.7. The draft law explicitly states that the credit register is to be established in order to facilitate statistical research that is to be carried out by Banka Slovenije, based on the Law on Banka Slovenije and Article 5 of the Statute of the ESCB. This research is to be conducted to support the carrying out of Banka Slovenije’s tasks, in particular in the fields of: (1) the conduct of monetary policy; (2) ensuring financial stability; and (3) macro-prudential supervision and risk management. The draft law further provides that Banka Slovenije shall also process the data collected in the credit register for the purposes of carrying out its supervisory tasks in accordance with the Law on 5 6 banking and

text: Regulation (EU) No 575/2013

text: of the European Parliament and of the Council , as well as for the supervision of other entities in accordance with other laws. Furthermore, the draft law provides that Banka Slovenije may, for the abovementioned purposes, link the part of the credit register’s database that relates to the data of business entities to other databases managed by Banka Slovenije, as well as to databases established and managed by the ECB for the purposes of carrying out the ECB’s tasks in accordance with the Statute of the ESCB and

text: Council Regulation (EC) 2533/98

text: 1.8. The information exchange system is to be set up as a part of the credit register that enables its members to access individualised data on the credit risks of natural persons and business entities. Its purpose is to facilitate the efficient assessment of credit risk, both in terms of the initial decision to grant credit and in terms of the ongoing assessment of existing exposures, and to promote policies and measures for responsible lending and sustainable indebtedness of natural persons and business entities. The management of the information exchange system includes the integration of data and information on business entities and natural persons from the credit register into the information exchange system and the centralised processing of data and information, which includes printouts of individualised data. The draft law specifies which members are reporting units that must mandatorily be included in the information exchange system and establishes retention periods for the data in the information exchange system. It also delineates the scope of the data to be contained in the information exchange system, with respect both to natural persons and business entities. The draft law regulates access to data in the information exchange system by its members, who must fulfil technical and security requirements to be determined by Banka Slovenije in implementing legislation. The draft law also lays down the rules on the protection of the confidentiality of information by members of the information exchange system. The draft law governs the right of the natural persons to be informed about their personal data in the information exchange system, in accordance with the Law on protection of personal data. Furthermore, the draft law establishes the right of business entities to be informed of the processing of data in the information exchange system. 1.9. The draft law provides that Banka Slovenije will carry out supervision of reporting units in order to ensure the fulfilment of their obligation to report the data to the credit register. In order to obtain information about and perform due diligence on a reporting unit, Banka Slovenije will carry out supervision on the basis of the Law on banking. 1.10. The draft law provides that reporting units will report data and information for the credit register to Banka Slovenije free of charge. The members of the information exchange system will pay a fee to be established by Banka Slovenije in the implementing legislation, which will cover both membership of the system and access to the information contained in it. The fee to be paid by business entities in order to receive information concerning the data held about them in the information exchange system is to be established in Banka Slovenije’s implementing legislation; whereas the fee to be paid by natural persons will be in accordance with the relevant provisions of the Law on protection of personal data.

text: 2. Scope of the opinion

text: This opinion focuses on: (1) specific aspects of the operation and management of the credit register and the information exchange system by Banka Slovenije (Section 3.1); and (2) the new tasks conferred on Banka Slovenije in relation to the prohibition of monetary financing under Article 123 of the Treaty (Section 3.2).

text: 3. Observations

text: 3.1 Operation and management of the credit register and the information exchange system by Banka

text: Slovenije

text: 3.1.1 The ECB welcomes the draft law. The explanatory memorandum states that the draft law aims to renew the existing national reporting framework in order to fulfil new reporting requirements in the context of the AnaCredit project. As specified in

text: Recital 12

text: of

text: Regulation (EU) 2016/867

text: (ECB/2016/13), the first stage of reporting under AnaCredit includes credit granted by credit institutions to legal entities. In subsequent stages the scope of reporting may be extended to collect data on instruments granted by financial intermediaries other than credit institutions, and on instruments granted to natural persons. In this context, the ECB also welcomes that the scope of the draft law is broader than the current scope of

text: Regulation (EU) 2016/867

text: (ECB/2016/13) as it already covers information which may be covered in subsequent amendments to

text: Regulation (EU) 2016/867

text: (ECB/2016/13), such as collection of credit and credit risk data in respect of natural persons. In addition, the ECB notes that the draft law not only enables the collection of such data in respect of natural persons, but also ensures the protection of their rights. 3.1.2 As noted in paragraph 1.5, Banka Slovenije shall through secondary implementing legislation prescribe the scope and content of data of business entities. For this purpose, the ECB suggests that the Banka Slovenije ensures at each point in time that the data model defined in such implementing legislation corresponds to the data model valid at that point in time under

text: Regulation (EU) 2016/867

text: (ECB/2016/13) in order for reporting requirements and implementation practices across the Eurosystem to remain sufficiently harmonised . Nevertheless, the ECB notes that further developments of the AnaCredit project, for instance by means of requiring additional data attributes to be collected, may lead to the need to amend the draft law in the future should Banka Slovenije’s power to adopt secondary implementing legislation prove insufficient for the purpose of incorporating such further developments. 3.1.3 The ECB understands that the draft law allows Banka Slovenije to link the part of the credit register’s database that relates to the data of business entities to databases established and managed by the ECB for the purposes of carrying out the ECB’s tasks, including for monetary policy, financial stability, macro-prudential supervisory, micro-prudential supervisory, risk management and statistical purposes. The ECB welcomes these provisions of the draft law, and notes that not only the financial markets in general, but also the Eurosystem, which uses credit risk assessment in its collateral framework for monetary policy operations, may benefit from a more informed evaluation of credit risk . For reasons of legal certainty and to promote the efficient supervision of significant credit institutions the ECB suggests that the draft law could usefully reinforce these provisions by including, for the avoidance of doubt, an explicit clarification that the

text: information in the credit register may be accessed by the ECB in order for it to carry out its supervisory tasks under

text: Regulation (EU) 1024/2013

text: . 3.1.4 The ECB welcomes that the draft law enables Banka Slovenije, as the sole operator of the information exchange system, to make special agreements on linking the information exchange system with comparable databases established in Member States. The ECB also welcomes that Banka Slovenije can also conclude agreements with operators of information exchange systems for assessing the creditworthiness of customers in third countries, if reciprocity is guaranteed. 3.1.5 The ECB welcomes that the system of electronic exchange will enable its members to develop more informed assessments of credit risk and enhance their risk management capabilities. The ECB understands that the confidentiality and protection of the data is fully guaranteed by the relevant provisions of the draft law.

text: 3.2 Conferral of new tasks on Banka Slovenije

text: 3.2.1 The draft law broadens Banka Slovenije’s current responsibilities relating to the collection of statistical data by assigning to Banka Slovenije new tasks in connection with the establishment and operation of a credit register as a centralised collection of granular credit and credit risk data. In addition, the draft law also establishes an information exchange system which enables its members to access granular credit and credit risk data on business entities. It also confers on Banka Slovenije supervisory tasks in relation to the reporting of the data and information included in the credit register. While it is acknowledged that the attribution of these new tasks is mainly driven by the aim to ensure compliance with

text: Regulation (EU) 2016/867

text: (ECB/2016/13), these new tasks are indeed part of a thorough revamping of the national framework for the reporting of risks whose management is entrusted to Banka Slovenije, which triggers the need to perform the assessment outlined below. 3.2.2 The ECB wishes to reiterate that when new tasks are conferred on a member of the European System of Central Banks (ESCB), it is necessary to assess such conferral against the prohibition of monetary financing under Article 123 of the Treaty. For this purpose, the ECB has developed guidance, in the form of general and specific considerations as set out in paragraphs 3.2.3 and 3.2.4, on the basis of which the ECB may decide whether the new task conferred on an ESCB national central bank (NCB) is to be considered a central banking task or a governmental task for the purposes of the monetary financing prohibition . The concrete assessment of whether Banka Slovenije’s tasks as the authority responsible for establishment and operation of the credit register are to be considered central banking tasks or governmental tasks is undertaken in paragraph 3.2.5 of this opinion. 3.2.3 First, the systematic categorisation of tasks assigned to NCBs as central banking or government tasks applies to genuinely new tasks that did not exist in the past or did not form an integral part of the central banking tasks already assigned to the NCB in the past. In recognition of the Member States’ legal frameworks, central banking traditions and national set-ups, the tasks currently

text: discharged by an NCB as central banking tasks are not reviewed and re-categorised, but may be reassessed if their substance is amended. Second, the principle of financial independence requires that the Member States may not put their NCBs in a position where they have insufficient financial resources to carry out their ESCB- or Eurosystem-related tasks. Third, central banking tasks comprise in particular those tasks that are related to the tasks listed in

text: Article 127(2)

text: , (5) and (6) of the Treaty. Fourth, new tasks conferred on an NCB that are atypical of NCBs’ tasks, or which are clearly discharged on behalf of and in the exclusive interest of the government or of other public entities, should be considered as governmental tasks. 3.2.4 An important criterion for qualifying a new task as a government tasks is the impact of the task on an NCB’s institutional, financial and personal independence. In particular, the following should be taken into account. First, it should be assessed whether the performance of the new task will create inadequately addressed conflicts of interests with existing central banking tasks, without necessarily complementing the existing central banking tasks. If a conflict of interest arises between existing and new tasks, there should be sufficient mitigation measures in place to adequately address that conflict. Complementarity between the new task and existing central banking tasks should not, however, be interpreted broadly, as this could lead to the creation of an indefinite chain of ancillary tasks. The assessment of the complementarity of a new task should also take into account the financing of that task. Second, it should be assessed whether, without new financial resources, the performance of the new task places a disproportionate burden on the financial or organisational capacity of the NCB concerned, and may negatively impact its capacity to properly perform existing central banking tasks. Third, it should be assessed whether the performance of the new task is aligned with the institutional set-up of the NCB, in particular as regards central bank independence and accountability considerations. Fourth, it should be assessed whether the performance of the new task entails substantial financial risks. Fifth, it should be assessed whether the performance of the new task expose the members of the NCB’s decision-making bodies to political risks which are disproportionate and may also impact on their personal independence and, in particular, the guarantee of the term of office under Article 14.2 of the Statute of the ESCB. Any final assessment on the qualification of a task given to an NCB as either falling within the scope of central banking tasks or government tasks should be guided by the objective of ensuring that the prohibition of monetary financing within the Eurosystem and the ESCB is consistently applied, to the extent that it applies to its members. 3.2.5 In the light of the above guidance the following paragraphs assess whether Banka Slovenije’s new tasks are in line with the monetary financing prohibition.

text: 3.2.5.1 Principle of financial independence

text: The principle of financial independence requires NCBs to have sufficient means to carry out not only their ESCB-related tasks but also their national tasks . In this respect, it is noted that Banka Slovenije shall prescribe a fee in the implementing legislation to members of the information exchange system for membership and access to the data. It shall also prescribe a fee to business entities regarding their right to be informed. 3.2.5.2 Links to tasks listed in

text: Article 127(2)

text: and (5) of the Treaty With regard to the credit register, it is noted that granular credit data based on central credit registers are necessary for the development and production of new ESCB statistics, as well as for increasing the quality of ESCB statistics. These new or improved statistics to be produced in the long term are necessary for the performance of Eurosystem tasks including monetary policy analysis and monetary policy operations, risk management, financial stability surveillance and research, as well as the Eurosystem’s contribution to the smooth conduct of policies pursued by the competent authorities relating to the prudential supervision of credit institutions and the stability of the financial system . These data will also be useful for banking supervision purposes in the context of the Single Supervisory Mechanism . In addition, as regards the information exchange system, it is noted that NCBs should be able to use the multi-purpose shared analytical granular credit data set to establish feedback loops with reporting agents or to enrich existing feedback loops and other information services from central credit registers to reporting agents. These feedback loops will enhance the ESCB’s contribution to the stability of the financial system in line with its statutory mandate according to Article 127(5) of the Treaty . The set-up and management of the credit register, including the information exchange system, are thus considered as tasks related to those referred to in the first indent of

text: Article 127(2)

text: and Article 127(5) of the Treaty. The new tasks are also complementary to Banka Slovenije’s existing macro- and micro-prudential supervisory tasks.

text: 3.2.5.3 Atypical tasks

text: Central banks have always had a strong interest in ensuring higher statistical data quality for analytical purposes. A number of Member States have established central credit registers and conferred the tasks involved in operating them upon NCBs . Moreover, in the long run all Eurosystem NCBs are required to operate national granular credit datasets under Decision ECB/2014/6 and

text: Regulation (EU) 2016/867

text: (ECB/2016/13) . The ECB’s powers in relation to the collection of statistical information are set out in Article 5 of the Statute of the ESCB, and

text: Article 4 of Council Regulation (EC) No 2533/98

text: requires all Member States to organise themselves in the field of statistics and fully cooperate with the ESCB in order to ensure the fulfilment of obligations

text: arising out of Article 5 of the Statute of the ESCB. The extension of Banka Slovenije’s powers in the field of statistics is therefore not regarded as atypical of a central bank. 3.2.5.4 Discharge of tasks on behalf of and in the exclusive interest of the Government or of other public

text: entities

text: Banka Slovenije is designated by the draft law as the sole operator of the credit register. Banka Slovenije shall exchange information with the members of the information exchange system in order to better manage credit risks. There is no indication that, in carrying out its tasks, Banka Slovenije would act exclusively in the interest of another public entity. 3.2.5.5 Extent to which the performance of tasks is aligned with Banka Slovenije’s institutional set-up, in

text: particular as regards accountability considerations

text: Given the complementarity with Banka Slovenije’s existing tasks, the new tasks appear to fit into Banka Slovenije’s current institutional set-up. In this respect, it is noted that the draft law stipulates that it does not interfere with the competence of Banka Slovenije regarding the collection and processing of data for supervisory purposes in accordance with the Law on banking. 3.2.5.6 Extent to which the performance of tasks is proportionate to Banka Slovenije’s financial and operational capacity and its ability to perform its ESCB-related tasks The ECB understands that Banka Slovenije has already taken the necessary measures to ensure that sufficient resources are available for the performance of the extended collection of statistical data. In addition, it is noted that certain costs related to Banka Slovenije’s new tasks will be covered by the fees levied on the members of the information exchange system and business entities pursuant to the implementing legislation. 3.2.5.7 Extent to which the performance of tasks entails substantial financial risks The draft law does not contain any specific provisions on liability for the operation of the credit register. Banka Slovenije’s potential liability for the performance of the new tasks given to it under the draft law will be thus subject to the rules on liability for damage caused in the exercise of public authority .

text: 3.2.5.8 Conclusion

text: The ECB considers that Banka Slovenije’s new tasks relating to the credit register and the information exchange system qualify as central banking tasks for the purposes of assessing their compliance with the monetary financing prohibition, in the sense that they expand Banka Slovenije’s statistical tasks and are linked to and complement Banka Slovenije’s existing monetary

text: policy, micro- and macro-prudential supervisory as well as financial stability tasks. This opinion will be published on the ECB’s website. Done at Frankfurt am Main, 31 August 2016. [signed]

text: The President of the ECB

text: Mario DRAGHI