Early intervention measures; authorisation to issue statutory instruments

(1) Where the financial position of an institution deteriorates significantly, in particular on account of its liquidity situation, its level of indebtedness, or loan losses or concentration risk, and the institution thereby breaches the requirements of Regulation (EU) No 575/2013, provisions of the Banking Act, or any of Articles 3 to 7, 14 to 17 and 24, 25 and 26 of Regulation (EU) No 600/2014 of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Regulation (EU) No 648/2012 (OJ L 173, 12.6.2014, p. 84), the supervisory authority may, without prejudice to its powers under the Banking Act, direct measures against the institution that are suitable and necessary to improve the institution's significantly deteriorated economic situation. The same applies where, following an assessment of the relevant circumstances, including the institution's own funds requirements plus 1.5 percentage points, the institution is threatened, in the near future, with a deterioration of its financial position within the meaning of the first sentence. In particular, the supervisory authority may 1. require the management body of the institution a) to update the recovery plan under section 12(4), where the circumstances that led to the satisfaction, or the threatened satisfaction, of the conditions referred to in the first sentence differ from the assumptions in the recovery plan; b) to implement one or more of the options for action referred to in the recovery plan; c) to carry out an analysis of the situation and draw up a plan, including a timetable, for overcoming the existing problems; d) to draw up a plan for negotiations on debt restructuring with some or all creditors; e) to change the business strategy and the legal and operational structures; f) to grant the supervisory authority and the resolution authority, including in the course of an on-site inspection, access to all information required to update the resolution plan, to prepare the resolution of the institution, and to value the institution's assets and liabilities for resolution purposes; section 78(2) applies correspondingly; g) to convene a meeting of shareholders with an agenda specified by the supervisory authority; where the management body does not comply, the supervisory authority may itself convene the meeting in place of the management body, including the necessary notices, invitations, publications and other acts, with the same effect; 2. require the institution to remove one or more members of the management body or of the supervisory or administrative organ of the institution, where they are not fit for the performance of their duties under the provisions of the Banking Act.
(2) The supervisory authority must inform the competent resolution authorities without delay where it is determined that an institution satisfies the conditions for the issue of a measure under subsection (1). The resolution authority may request the supervisory authority to examine whether the conditions under subsection (1) are satisfied in respect of an institution.
(2a) Where the conditions of subsection (1) are satisfied, the resolution authority may, in accordance with subsection (1), third sentence, point 1, letter f, require the management body of the institution to grant access to information to staff of the resolution authority or persons engaged by the resolution authority, and to a valuer within the meaning of section 70(1). The resolution authority may require the institution, observing the conditions set out in section 126(2) and the duties of confidentiality under sections 4 to 10, to approach potential acquirers in order to prepare the resolution of the institution, and to make appropriate information available to potential acquirers so that they can assess the advantages and risks of an acquisition.
(3) Subsection (1) does not preclude the institution's obligation to observe participation rights under the Works Constitution Act; this does not affect the institution's duty to comply fully with the direction within the time limit set by the supervisory authority.
(4) The Federal Ministry of Finance is authorised to issue, by statutory instrument not requiring the consent of the Bundesrat, more detailed provisions on the circumstances from which a breach threatened in the near future under subsection (1), second sentence, may be inferred. The Federal Ministry of Finance may, by statutory instrument, delegate the authorisation to the Federal Financial Supervisory Authority, with the proviso that the statutory instrument is issued in consultation with the resolution authority.
(5) The articles of association of an institution in the legal form of a stock corporation may provide that a general meeting whose agenda includes, alone or alongside other items, a resolution on a capital increase is, by way of derogation from section 123(1), first sentence, of the Stock Corporation Act, to be convened at least ten days before the general meeting, where 1. the conditions for supervisory action under subsection (1), first or second sentence, are satisfied, and 2. a capital increase is necessary to prevent the resolution conditions within the meaning of section 62 from arising. The resolution of the general meeting on a corresponding amendment to the articles of association requires a majority of two-thirds of the votes cast.
(6) In determining the minimum time limit, the day of convening is not counted. Section 121(7) of the Stock Corporation Act applies correspondingly. Where the articles of association provide that the time limit under section 123(1), first sentence, of the Stock Corporation Act may be shortened, and use is made of this, there must be at least three days between registration and the meeting, and notifications under section 125(1), first sentence, of the Stock Corporation Act must be made without delay; section 121(7), section 123(2), fourth sentence, and section 125(1), second sentence, of the Stock Corporation Act apply correspondingly. Section 122(2), third sentence, of the Stock Corporation Act applies with the proviso that the company's request must be received at least six days before the meeting. The company must facilitate the granting of proxy voting rights by shareholders, insofar as this is possible under statute and the articles of association. Notifications to shareholders, and applications by shareholders submitted in due time, must be made accessible to all shareholders and published in summary form. Notifications need not be sent where the management board, with the consent of the supervisory board, is satisfied that timely receipt by shareholders is not likely.
(7) A resolution of the general meeting on a capital increase within the meaning of subsection (5) must be registered without delay for entry in the commercial register. It must, unless manifestly void, be entered in the commercial register without delay. Actions or applications for interim injunction proceedings do not preclude its entry. Section 246a(4) of the Stock Corporation Act applies correspondingly.
(8) Subsections (1) to (7) apply correspondingly to superordinate undertakings within the meaning of section 10a of the Banking Act, and to institutions that are required to sub-consolidate under Article 22 of Regulation (EU) No 575/2013, where the requirements of subsection (1), first sentence, are breached at the consolidated level, or such a breach is threatened in the near future.