Appendix No. 2 Assessment of the Financial Soundness of Institutions

Appendix No 2 to Article 3, paragraph 2, point 3

Assessment of the Financial Soundness

of Institutions

1. When assessing the financial soundness of institutions with a view to their admission to participate in Eurosystem monetary policy operations, the BNB shall take into account: (a) quarterly information on capital, leverage and liquidity ratios reported under Regulation (EU) No 575/2013 on an individual and consolidated basis, in accordance with supervisory requirements; or (b) where applicable, prudential information that is comparable to the information under point (a).
2. In the event that the supervisory authority of the institution does not provide this prudential information to the BNB or the ECB, the BNB or the ECB may require the institution to provide the information. When the information is provided directly by an institution, it shall also submit an assessment of the information carried out by the relevant supervisory authority. The Bulgarian National Bank may also require additional certification by an external auditor.
3. For branches, the information under item 1 for the institution to which the branch belongs shall be taken into account.
4. As regards the assessment of the financial soundness of institutions that have been subject to in-kind recapitalisation with public debt instruments, in ensuring compliance with the requirements for capital ratios reported under Regulation (EU) No 575/2013, the BNB shall take into account the methods used in the in-kind recapitalisations and its role, including the type and liquidity of the instruments and the market access of the issuer of the instruments.
5. A wind-down entity shall not be eligible to access Eurosystem monetary policy operations.