Royal Decree of 21 February 2022 approving the Regulation of the National Bank of Belgium of 26 October 2021 imposing a tier 1 common equity capital buffer for the systemic risk linked to exposures to retail customers concerning natural persons secured by residential real estate located in Belgium

FEDERAL PUBLIC SERVICE FINANCES
[C − 2022/20369]
21 FEBRUARY 2022. — Royal Decree approving the Regulation of the National Bank of Belgium of 26 October 2021 imposing a tier 1 common equity capital buffer for the systemic risk linked to exposures to retail customers concerning natural persons, which are secured by non-commercial real estate located in Belgium

PHILIP, King of the Belgians,

To all present and to come, Greetings.

Having regard to the Law of 22 February 1998 fixing the organic statute of the National Bank of Belgium, Article 12bis, § 2;

Having regard to the Law of 25 April 2014 on the status and supervision of credit institutions and stock exchange companies, Article 97, and Article 16/1, f) of Annex IV, read in conjunction with Article 16/1, b), i) of that same Annex;

Having regard to the opinion of the Financial Inspection, given on 18 January 2022;

Having regard to the agreement of the Secretary of State for the Budget, dated 29 January 2022;

Having regard to Article 8, § 1, 4° of the Law of 15 December 2013 containing various provisions on administrative simplification, this decree is exempt from a regulatory impact analysis because it concerns self-regulation provisions;

On the proposal of the Minister of Finance and on the advice of the Ministers meeting in Council,

We have decided and decide:

Article 1. The Regulation of the National Bank of Belgium of 26 October 2021 imposing a tier 1 common equity capital buffer for the systemic risk linked to exposures to retail customers concerning natural persons, which are secured by non-commercial real estate located in Belgium, attached to this decree, is approved.

Art. 2. The Minister responsible for Finance is charged with the execution of this decree.

Given in Brussels, 21 February 2022.

PHILIP

By the King:

The Deputy Prime Minister and Minister of Finance,
V. VAN PETEGHEM

Appendix to the Royal Decree of 21 February 2022 approving the Regulation of the National Bank of Belgium of 26 October 2021 imposing a tier 1 common equity capital buffer for the systemic risk linked to exposures to retail customers concerning natural persons, which are secured by non-commercial real estate located in Belgium

The National Bank of Belgium,

Having regard to the Law of 25 April 2014 on the status and supervision of credit institutions and stock exchange companies, Article 97, and Article 16/1, f) of Annex IV, read in conjunction with Article 16/1, b), i) of that same Annex;

Having regard to the Law of 22 February 1998 fixing the organic statute of the National Bank of Belgium, Article 12bis, § 2;

Considering that Article 16/1, f) of Annex IV to the Law of 25 April 2014, which transposes Article 133 of Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on the access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, allows the National Bank of Belgium to require credit institutions or one or more sub-groups of credit institutions to hold a buffer consisting of tier 1 common equity capital, for all exposures or a segment of exposures, to anticipate or mitigate the impact of systemic or macroprudential risks that are not covered by Regulation (EU) No 575/2013 and by the national provisions transposing Articles 130 and 131 of the aforementioned Directive, within the meaning of structural risks of perturbation of the financial system that may have serious consequences for the stability of the financial system and the real economy in Belgium.

Considering that imposing a buffer for the systemic risk linked to exposures secured by non-commercial real estate located in Belgium is justified, given the volume of these exposures and the persistent vulnerabilities, in particular 1° the strong growth of real estate-backed loans and the resulting increase in the debt burden of Belgian households; 2° the still significant share in the aforementioned loans of sub-segments considered riskier; and 3° the dynamics in the evolution of housing prices in Belgium;

Considering that the measure provided for in Article 16/1, f), read in conjunction with Article 16/1, b), i) of Annex IV to the Law of 25 April 2014 allows covering the aforementioned systemic risk.

DECIDES:

Article 1 – Scope of application

§ 1. For the purposes of this decree, "the Law of 25 April 2014" means the Law of 25 April 2014 on the status and supervision of credit institutions and stock exchange companies.

§ 2. The provisions of this regulation apply to the credit institutions referred to in Book II and Book III, Title II of the Law of 25 April 2014.

Art. 2 – Macroprudential measure

The credit institutions referred to in Article 1, § 2 shall hold a tier 1 common equity capital buffer, the amount of which is calculated by multiplying the weighted amount of exposures to retail customers concerning natural persons, which are secured by non-commercial real estate located in Belgium, calculated in accordance with Article 154 of Regulation (EU) No 575/2013, by 9 percent.

Art. 3 – Entry into force

This regulation shall enter into force on 1 May 2022, provided that the European Commission has adopted the implementing act referred to in Article 20 of Annex IV to the Law of 25 April 2014, authorizing the Bank to impose the measure referred to in Article 2, which must be notified by 30 January 2022 at the latest, adopted in accordance with Article 17, § 1 of Annex IV to the Law of 25 April 2014, read in conjunction with Article 20 of that same Annex.

This regulation shall cease to produce effects on 30 April 2023.

Brussels, 21 February 2022.

The Governor,

Seen to be attached to our decree of 21 February 2022 approving the Regulation of the National Bank of Belgium of 26 October 2021 imposing a tier 1 common equity capital buffer for the systemic risk linked to exposures to retail customers concerning natural persons, which are secured by non-commercial real estate located in Belgium.

PHILIP

By the King:

The Deputy Prime Minister and Minister of Finance,
V. VAN PETEGHEM

SERVICE PUBLIC FEDERAL FINANCES
[C − 2022/20369]
21 FEBRUARY 2022. — Royal Decree approving the Regulation of the National Bank of Belgium of 26 October 2021 imposing a tier 1 common equity capital buffer for the systemic risk linked to exposures to retail customers concerning natural persons, which are secured by residential real estate located in Belgium

PHILIPPE, King of the Belgians,

To all present and to come, Greetings.

Having regard to the Law of 22 February 1998 fixing the organic statute of the National Bank of Belgium, Article 12bis, § 2;

Having regard to the Law of 25 April 2014 on the status and supervision of credit institutions and stock exchange companies, Article 97 and Article 16/1, f) of Annex IV read in conjunction with Article 16/1, b), i) of that same Annex;

Having regard to the opinion of the Financial Inspection, given on 18 January 2022;

Having regard to the agreement of the Secretary of State for the Budget, given on 29 January 2022;

Having regard to Article 8, § 1, 4° of the Law of 15 December 2013 containing various provisions on administrative simplification, this decree is exempt from a regulatory impact analysis, as it concerns self-regulation provisions;

On the proposal of the Minister of Finance and on the advice of the Ministers who have deliberated in Council,

We have decided and decide:

Article 1. The Regulation of the National Bank of Belgium of 26 October 2021 imposing a tier 1 common equity capital buffer for the systemic risk linked to exposures to retail customers concerning natural persons, which are secured by residential real estate located in Belgium, annexed to this decree, is approved.

Art. 2. The Minister who has Finance in his portfolio is charged with the execution of this decree.

Given in Brussels, 21 February 2022.

PHILIPPE

By the King:

The Deputy Prime Minister and Minister of Finance,
V. VAN PETEGHEM

Appendix to the Royal Decree of 21 February 2022 approving the Regulation of the National Bank of Belgium of 26 October 2021 imposing a tier 1 common equity capital buffer for the systemic risk linked to exposures to retail customers concerning natural persons, which are secured by residential real estate located in Belgium

The National Bank of Belgium,

Having regard to the Law of 25 April 2014 on the status and supervision of credit institutions and stock exchange companies, Article 97 as well as Article 16/1, f) of Annex IV read in conjunction with Article 16/1, b), i) of that same Annex;

Having regard to the Law of 22 February 1998 fixing the organic statute of the National Bank of Belgium, Article 12bis, § 2;

Considering that Article 16/1, f) of Annex IV to the Law of 25 April 2014, transposing Article 133 of Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on the access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, allows the National Bank of Belgium to require credit institutions or one or more sub-groups of credit institutions to hold a buffer consisting of tier 1 common equity capital, for all exposures or a subset of exposures, in order to anticipate or mitigate the impact of systemic or macroprudential risks that are not covered by Regulation (EU) No 575/2013 and by the national provisions transposing Articles 130 and 131 of the aforementioned Directive, within the meaning of structural risks of perturbation of the financial system susceptible of having serious repercussions on the stability of the financial system and the real economy in Belgium;

Considering that imposing a buffer for the systemic risk applicable to exposures secured by residential real estate located in Belgium is justified with regard to the extent of these exposures and with regard to the persistence of observed vulnerabilities, in particular, 1° the significant growth of credits secured by real estate and the increase in the indebtedness of Belgian households resulting from it; 2° the still significant share among the aforementioned credits of sub-segments considered to be riskier; and 3° the dynamics observed in the evolution of residential real estate prices in Belgium;

Considering that the measure provided for in Article 16/1, f) read in conjunction with Article 16/1, b), i) of Annex IV to the Law of 25 April 2014 allows covering the aforementioned systemic risk.

DECIDES:

Article 1 – Scope of application

§ 1. For the purposes of this decree, "the Law of 25 April 2014" means the Law of 25 April 2014 on the status and supervision of credit institutions and stock exchange companies.

§ 2. The provisions of this regulation apply to the credit institutions referred to in Book II and Book III, Title II of the Law of 25 April 2014.

Art. 2 – Macroprudential measure

The credit institutions referred to in Article 1, § 2 shall hold a tier 1 common equity capital buffer, the amount of which is calculated by multiplying by 9 percent the weighted amount of exposures to retail customers concerning natural persons, which are secured by residential real estate located in Belgium, and which is calculated in accordance with Article 154 of Regulation (EU) No 575/2013.

Art. 3 – Entry into force

This regulation shall enter into force on 1 May 2022, provided that the European Commission has adopted the implementing act referred to in Article 20 of Annex IV to the Law of 25 April 2014 authorizing the Bank to impose the measure referred to in Article 2, such as notified by 30 January 2022 at the latest, in application of Article 17, § 1 of Annex IV to the Law of 25 April 2014 read in conjunction with Article 20 of that same Annex.

This regulation shall cease to produce its effects on 30 April 2023.

Brussels, 21 February 2022.

The Governor,

Seen to be attached to our decree of 21 February 2022 approving the Regulation of the National Bank of Belgium of 26 October 2021 imposing a tier 1 common equity capital buffer for the systemic risk linked to exposures to retail customers concerning natural persons, which are secured by residential real estate located in Belgium.

PHILIPPE

By the King:

The Deputy Prime Minister and Minister of Finance,
V. VAN PETEGHEM

BELGIAN OFFICIAL JOURNAL — 29.03.2022 — MONITEUR BELGE 25525