EBA reports on monitoring of Additional Tier 1 instruments

The EBA has published a final report on the monitoring of Additional Tier 1 (AT1) instruments and proposed standardised templates for AT1 instruments. The final report, which follows a draft dated 29 May 2015, includes new provisions on triggers, calls, repurchases, redemptions, tax events, gross-up provisions and conversion and write-down mechanisms.

Alongside the report, the EBA has also published standardised templates for AT1 issuances. The templates cover the prudential provisions of AT1 issuances and contain essential and optional provisions concerning, in particular:

• flexibility of payments;
• permanence; and
• loss absorbency.

The templates are designed to assist with the practical implementation of the provisions laid down in the CRR, the Regulatory Technical Standards (RTS) and Q&As.