Einde inhoudsopgave
State aid to banks (IVOR nr. 109) 2018/8.10.1
8.10.1 Targeted at the appropriate beneficiaries
mr. drs. R.E. van Lambalgen, datum 01-12-2017
- Datum
01-12-2017
- Auteur
mr. drs. R.E. van Lambalgen
- JCDI
JCDI:ADS592966:1
- Vakgebied(en)
Financieel recht / Europees financieel recht
Mededingingsrecht / EU-mededingingsrecht
Voetnoten
Voetnoten
Swedish recapitalisation scheme, N69/2009, 10 February 2009, para. 32. See also: Finnish recapitalisation scheme, N329/2009, 11 September 2009, para. 35.
See for instance: Finnish guarantee scheme, N567/2008, 13 November 2008, para. 35.
The UK scheme is an exception to this observation, since it limits the eligibility for the entire scheme (which includes a guarantee scheme and recap scheme) to solvent banks.
The 2013 Banking Communication introduced an additional criterion with respect to the eligibility for guarantee schemes: pursuant to point 60a, the scheme must be restricted to banks without a capital shortfall. The guarantee schemes that were assessed on the basis ofthe 2013 Banking Communication were all in line with this new requirement. For instance, in July 2013, Poland limited the eligibility of the guarantee scheme to solvent banks which have no capital shortfall according to the most recent Union-wide capital exercise or other equivalent national exercises by the national supervisory authorities. See: Polish guarantee scheme (prolongation), SA.36965, 23 July 2013, para. 5. Footnote 10 specified that ‘no capital shortfall’ means a capitalization of at least 9% (according to the EBA capital exercise).
Swedish guarantee scheme, N533/2008, 29 October 2008, para. 5.
May every bank benefit from State aid under the scheme or is the scope of the scheme limited to certain banks? This question concerns the eligibility for the scheme. Many guarantee schemes and some recapitalisation schemes were targeted at solvent/fundamentally sound banks. The Commission considered that those schemes were targeted at the appropriate beneficiaries. The fact that the scope of the bank support scheme is limited to solvent/fundamentally sound banks thus appears to be a relevant characteristic.
The following recital clearly explains the rationale of limiting the eligibility of the recapitalisation scheme:
“This is in principle an appropriate means to strengthen financial institutions and thus to prevent credit supply restrictions and limit the passing-on of the financial markets difficulties to other businesses. This is all the more so as the Scheme is exclusively aimed at institutions that are fundamentally sound, and thus, rather than absorbing new capital simply to ensure their solvency, will be in a position to translate a more comfortable capital levels into increased lending activities”.1
By contrast, the Commission does not clearly explain the rationale of limiting the eligibility for the guarantee scheme. The Commission merely indicated that “the scheme is targeted at the appropriate beneficiaries as the eligibility of participating firms is limited in principle to solvent companies”.2
With respect to the elaboration of the relevant characteristic, it should be noted that the guarantee schemes use the term “solvent”, while the recapitalisation schemes use the term “fundamentally sound”.3 While “fundamentally sound” refers to the well-known indicator (i.e. aid amount exceeding more than 2% of the bank’s RWA), the decisions do not apply a uniform definition of ‘solvent’.4 For instance, the under the Swedish guarantee scheme ‘solvent’ was understood as banks with at least 6% Tier 1 capital and at least 9% combined Tier 1 and Tier 2 capital.5 In a decision on another scheme, ‘solvent’ was interpreted as a Tier 1 ratio of 7%.
Although the Commission welcomes the fact that the scheme is limited to fundamentally sound/solvent banks, it is not applied consistently. Many recapitalisation schemes were open to fundamentally sound banks as well as distressed banks. While the Commission noted positively the fact that the scheme was aimed at fundamentally sound banks, it did not note negatively the fact that the scheme was open to all banks.
More importantly, the fact that the scheme is limited to fundamentally sound/solvent banks is not really a relevant characteristic. Indeed, even if distressed banks are excluded from the scope of the recapitalisation scheme, they can still be recapitalised by means of an individual aid measure.