S.L. 330.9 Art. 4Simplified obligations for certain institutions.

(1) Having regard to the impact that the failure of an institution could have, due to the nature of its business; its shareholding structure; its legal form; its risk profile, size and legal status; its interconnectedness to other institutions or to the financial system in general; the scope and the complexity of its activities; its membership of an IPS or other cooperative mutual solidarity systems as referred to in Article 113(7) of the CRR and any exercise of investment services or activities as defined in point (2) of Article 4(1) of Directive 2014/65/EU, and whether its failure and subsequent winding up under normal insolvency proceedings would be likely to have a significant negative effect on financial markets, on other institutions, on funding conditions, or on the wider economy, the Authority and the Resolution Committee shall determine:

(a) the contents and details of recovery and resolution plans provided for in regulations 5 to 12;

(b) the date by which the first recovery and resolution plans are to be drawn up and the frequency for updating recovery and resolution plans which may be lower than that provided for in regulation 5(2), regulation 7(5), regulation 10(6) and regulation 13(5);

(c) the contents and details of the information required from institutions as provided for in regulation 5(5) and (6), regulation 11(1) and regulation 12(2) and in Sections A and B of the Schedule to these regulations;

(d) the level of detail for the assessment of resolvability provided for in regulations 15 and 16, and Section C of the Schedule to these regulations.

(2) The Authority and the Resolution Committee shall make the assessment referred to in sub-regulation (1) following consultation with the Central Bank.

(3) Where the Authority or the Resolution Committee apply simplified obligations on an institution, the Authority or the Resolution Committee may still, where relevant, impose full, non-simplified obligations at any time: Provided that where simplified obligations are imposed, the application of simplified obligations shall not, in itself, affect the Authority’s and, where relevant, the Resolution Committee’s powers to take a crisis prevention measure or a crisis management measure.

(4) The Authority and the Resolution Committee shall inform the EBA of the way sub-regulations (1), (5), (6) and (7) have been applied to institutions licensed under the Banking Act and

Investment Services Act.

(5) Subject to sub-regulations (6) and (7), the Authority, and where relevant, the Resolution Committee may waive the application of:

(a) the requirements of regulations 5 to 14 to institutions affiliated to a central body and wholly or partially exempted from prudential requirements in accordance with Article 10 of the CRR;

(b) the requirements of regulations 5 to 9 to institutions which are members of an IPS.

(6) (a) Where a waiver pursuant to sub-regulation (5) is granted, the Authority, or where relevant, the Resolution Committee shall:

(i) apply the requirements of regulations 5 to 14 on a consolidated basis to the central body and institutions affiliated to it within the meaning of Article 10 of the CRR;

(ii) require the IPS to fulfil the requirements of regulations 5 to 9 in cooperation with each of its waived members.

(b) For the purpose of this sub-regulation, any reference in regulations 5 to 14 to a group shall include a central body and institutions affiliated to it within the meaning of Article 10 of the CRR and their subsidiaries, and any reference to parent undertakings or institutions that are subject to consolidated supervision pursuant to regulation 3 of the Supervisory Consolidation Regulations, shall include the central body.

(7) (a) Institutions subject to direct supervision by the European Central Bank pursuant to Article 6(4) of Council Regulation (EU) No 1024/2013 of 15 October 2013 conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutions or which constitutes a significant share in the financial system of Malta shall draw up their own recovery plans in accordance with regulations 5 to 9 and shall be subject to individual resolution plans in accordance with regulations 10 to 14.

(b) For the purposes of this sub-regulation, the operations of an institution shall be considered to constitute a significant share of Malta’s financial system if any of the following conditions are met:

(i) the total value of its assets exceeds EUR 30 000 000 000; or

(ii) the ratio of its total assets over the GDP of Malta exceeds 20%, unless the total value of its assets is below EUR 5 000 000 000.