Regulatory Alerts2017-10-17
Royal Decree-Law 2/2011 of 18 February for the reinforcement of the financial system
The Spanish Government issued Royal Decree-Law 2/2011 to reinforce the solvency of credit institutions by imposing immediate Basel III-compliant capital requirements of 8% to 10% of risk-weighted assets. The decree modifies the legal framework of the FROB to allow temporary public capital injections via ordinary shares for entities failing to meet these standards, contingent upon restructuring plans and eventual transformation if they are savings banks. Additionally, the law introduces transitional compliance strategies and fiscal measures to ensure neutrality during the financial sector's restructuring process.
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