Combined capital buffer requirement

(1) The combined capital buffer requirement is the total Common Equity Tier 1 capital of an institution that is necessary to meet the following capital buffer requirements:
1. the capital conservation buffer under section 10c,
2. the institution-specific countercyclical capital buffer under section 10d, and
3. in accordance with section 10h,
a) the systemic risk buffer under section 10e,
b) the buffer for global systemically important institutions under section 10f, and
c) the buffer for other systemically important institutions under section 10g.
(1a) The combined capital buffer requirement is not, or is no longer, met where an institution does not have own funds of the amount and quality required to meet the combined capital buffer requirement at the same time as additionally meeting the requirements under
1. Article 92(1)(a) of Regulation (EU) No 575/2013 and the additional own funds requirement to cover risks other than the risk of excessive leverage under section 6c and the increased own funds requirements under section 10(3) and (4);
2. Article 92(1)(b) of Regulation (EU) No 575/2013 and the additional own funds requirement to cover risks other than the risk of excessive leverage under section 6c and the increased own funds requirements under section 10(3) and (4); and
3. Article 92(1)(c) of Regulation (EU) No 575/2013 and the additional own funds requirement to cover risks other than the risk of excessive leverage under section 6c and the increased own funds requirements under section 10(3) and (4).
(2) An institution that meets the combined capital buffer requirement may not make a distribution from Common Equity Tier 1 capital, or on Common Equity Tier 1 instruments under subsection (5), where this would reduce its Common Equity Tier 1 capital to such an extent that the combined capital buffer requirement would no longer be met.
(3) An institution that does not, or no longer, meet the combined capital buffer requirement must calculate the maximum distributable amount and notify it to the supervisory authority and the Deutsche Bundesbank. The institution must take steps to ensure that the amount of distributable profits and the maximum distributable amount are calculated accurately, and must be able to demonstrate the accuracy of the calculation to the supervisory authority and the Deutsche Bundesbank on request. Until the supervisory authority decides on approving the capital conservation plan under subsections (7) and (8), the credit institution may not
1. make a distribution from Common Equity Tier 1 capital or on Common Equity Tier 1 instruments under subsection (5),
2. enter into an obligation to pay variable remuneration or discretionary pension benefits, or pay variable remuneration, where the corresponding obligation was entered into during a period in which the credit institution did not meet the combined capital buffer requirement, and
3. make payments on Additional Tier 1 instruments. Further particulars are set out in the statutory instrument under section 10(1), first sentence, point 5(e).
(4) An institution that does not, or no longer, meets the combined capital buffer requirement and intends, under subsection (7), fourth sentence, or subsection (8), first sentence, point 2, to make a distribution of distributable profits or to carry out a measure under subsection (3), third sentence, points 1 to 3, communicates that intention to the supervisory authority and the Deutsche Bundesbank, stating the following information:
1. the own funds held by the institution, broken down by
a) Common Equity Tier 1 capital;
b) Additional Tier 1 capital, and
c) Tier 2 capital;
2. the amount of interim profits and year-end profits;
3. the amount of the maximum distributable amount; and
4. the amount of distributable profits and their intended allocation between
a) distributions to shareholders or owners;
b) buy-back or repurchase of shares;
c) payments on Additional Tier 1 instruments; and
d) payment of variable remuneration or discretionary pension benefits, either on account of a new payment obligation being entered into, or a payment obligation entered into during a period in which the credit institution did not meet the combined capital buffer requirement.
(5) A distribution from Common Equity Tier 1 capital or on Common Equity Tier 1 instruments comprises
1. cash distributions of profits,
2. the issue of partly or fully paid-up bonus shares or other own funds instruments listed in Article 26(1)(a) of Regulation (EU) No 575/2013,
3. a redemption or buy-back, by an institution, of its own shares or other instruments under Article 26(1)(a) of Regulation (EU) No 575/2013,
4. a repayment of amounts paid up in connection with the own funds instruments under Article 26(1)(a) of Regulation (EU) No 575/2013, and
5. a distribution of items listed in Article 26(1)(b) to (e) of Regulation (EU) No 575/2013.
(6) An institution that does not, or no longer, meets the combined capital buffer requirement must, in addition to the requirements of subsections (3) to (4), draw up a capital conservation plan and submit it to the supervisory authority and the Deutsche Bundesbank within five working days of determining that it cannot meet the combined capital buffer requirement. The supervisory authority may extend the period for submission to no more than ten working days, where this appears appropriate in the individual case, having regard to the scope and complexity of the institution's business activities. The capital conservation plan comprises
1. an estimate of income and expenditure and a forecast balance sheet,
2. measures to increase the institution's capital ratios,
3. a plan and a timetable for increasing own funds, in order to meet the combined capital buffer requirement in full, and
4. further information that the supervisory authority considers necessary for the assessment prescribed under subsection (7).
(6a) (repealed)
(7) The supervisory authority assesses the capital conservation plan and approves it where it considers that its implementation is very likely to preserve or raise sufficient capital to enable the institution to meet the combined capital buffer requirement within a period the supervisory authority considers appropriate. Approval may be revoked where the conditions under the first sentence no longer apply on account of facts arising, or becoming known to the supervisory authority, subsequently. The supervisory authority decides on approval within 14 days of receiving the capital conservation plan. Once the capital conservation plan has been approved, the institution is entitled to carry out measures under subsection (3), third sentence, points 1 to 3, up to the amount of the maximum distributable amount.
(8) Where the supervisory authority does not approve the capital conservation plan, or revokes its approval,
1. the supervisory authority orders that the prohibitions under subsection (3), third sentence, continue to apply or apply again, or
2. the supervisory authority permits the institution to carry out measures within the meaning of subsection (3), third sentence, points 1 to 3, up to a specified amount, which may not exceed the maximum distributable amount. In addition, it may require the institution to increase its own funds to a specified amount within a specified period.
(9) The restrictions laid down in this provision apply exclusively to payments and distributions that lead to a reduction of Common Equity Tier 1 capital or of profits, and insofar as the suspension of a payment, or a missed payment, constitutes neither a default nor a condition for initiating proceedings under the insolvency provisions applicable to the institution.
(10) Subsections (1) to (9) apply correspondingly to institutional groups, financial holding groups, and mixed financial holding groups.