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No. 774/2024
1 July 2024

RULES

on variable components of remuneration of board members and employees of financial undertakings.

Art. 1. Scope.

These rules apply to financial undertakings under the Act on Financial Undertakings, No. 161/2002.

Art. 2.

Variable remuneration and classification of employees who have an impact on the risk profile of a financial undertaking.

With regard to instruments used for the payment of bonuses, cf. point 10 of the first paragraph of Art. 57 b of the Act on Financial Undertakings, a financial undertaking shall comply with Regulation (EU) No. 527/2014, cf. Art. 3.

The definition of managerial responsibility, control functions, material business unit, material impact on the risk profile of a material business unit and employees who have a material impact on the risk profile of a financial undertaking pursuant to Art. 57 f of the Act on Financial Undertakings shall be governed by Regulation (EU) 2021/923, cf. Art. 3.

Art. 3. Implementation of regulations.

With these rules, the following regulations enter into force in Iceland:

Commission Delegated Regulation (EU) No. 527/2014 of 12 March 2014 supplementing Directive 2013/36/EU of the European Parliament and of the Council with regard to regulatory technical standards specifying the classes of instruments that adequately reflect the credit quality of an institution as a going concern and are appropriate to be used for the purposes of variable remuneration, which was incorporated into the EEA Agreement by Decision of the EEA Joint Committee No. 81/2019 of 29 March 2019, published in the EEA Supplement to the Official Journal of the European Union No. 44 of 2 July 2020, p. 65, with the adaptations resulting from the Decision. The Regulation is published in the EEA Supplement to the Official Journal of the European Union No. 69 of 29 October 2020, pp. 54-61.
Commission Delegated Regulation (EU) 2021/923 of 5 March 2021 supplementing Directive 2013/36/EU of the European Parliament and of the Council with regard to regulatory technical standards setting out the criteria to define managerial responsibility, control functions, material business units and a material impact on the risk profile of a material business unit, and setting out criteria for identifying staff members or categories of staff whose professional activities have an impact on the institution's risk profile that is comparably material to the impact of staff members or categories of staff referred to in the third paragraph of Art. 92 of that Directive, which was incorporated into the EEA Agreement by Decision of the EEA Committee No. 142/2022 of 29 April 2022, published in the EEA Supplement to the Official Journal of the European Union No. 61 of 22 September 2022, p. 96.

With reference to the authorisation in the transitional provision III of Act No. 161/2002 on Financial Undertakings, cf. Act No. 57/2015, the Central Bank of Iceland refers to the publication of the English version of Commission Regulation (EU) 2021/923 in the Official Journal of the European Union: https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:32021R0923, published in OJ Series L, Subseries R, No. 203, on 9 June 2021, pp. 1-7.

Art. 4. Entry into force.

These rules, which are issued with the authorisation in the fourth paragraph of Art. 57 f. and point 8 of the first paragraph of Art. 117 a of the Act on Financial Undertakings, No. 161/2002, enter into force immediately. With their entry into force, Rules No. 790/2022 on variable components of remuneration of board members and employees of financial undertakings are repealed.

Central Bank of Iceland, 1 July 2024.