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CRD 4- methods under Financial Conglomerates Directive


The Joint Committee of the three European Supervisory Authorities has published
draft Regulatory Technical Standards (RTS) on the consistent application
of the calculation methods described in the Financial Conglomerates Directive
covering the assessment of the financial situation of credit institutions,
insurance undertakings and investment firms which are part of a financial
conglomerate.  This is in accordance with the Capital Requirements
Directive and Capital Requirements Regulation (together, CRD 4).

The draft RTS define the calculation methods for the determination of required
capital at the financial conglomerate level. Their underlying principles are

  • eliminate multiple gearing and intra-group creation of own funds;
  • ensure transferability and availability of own funds; and
  • cover deficit at financial conglomerate level having regard to definition of cross-sector capital. 

The RTS aim to harmonise the use of the calculation methods in order to ensure a
consistent approach in the calculations is applied across different financial

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