Suitability of shareholders or partners
- Articles 18, 46 to 54 and 72,§ 2 of the Banking Law
- Communication NBB_2017_22 of 22 September 2017 to candidate shareholders and assigning shareholders
- Circular NBB_2017_23 of 22 September 2017 to financial institutions on acquisitions, increases, reductions and transfers of qualifying holdings
- Joint Guidelines of EBA, EIOPA and ESMA on the prudential assessment of acquisitions and increases of qualifying holdings in the financial sector
From a prudential point of view, it is essential that significant shareholders should have the qualities necessary to ensure that they will exercise their influence to promote a sound and prudent management of the credit institution and development on a going concern basis. They should also take into account the sound governance expectations to be met by credit institutions.
Not only is this prudential requirement a prerequisite for obtaining an authorization, but it also continues to apply afterwards. It is reflected especially in the prudential assessment which must be made of the qualities of natural or legal persons who have decided to acquire or significantly increase a qualifying holding in the capital of the credit institution.
The significant shareholders and the credit institution, as soon as it has knowledge thereof, should inform the supervisory authority of any changes (an increase or decrease above or below certain thresholds) in the credit institution's capital structure.
The credit institution should provide the supervisory authority with all relevant information on its important shareholders of which it is aware and which can have an influence on the prudential assessment of these shareholders. The shareholders concerned are subject to the same obligation.
The criteria for the prudential assessment, both in the context of the application for authorization and subsequently, are explained in the "Joint Guidelines of EBA, EIOPA and ESMA on the prudential assessment of acquisitions and increases of qualifying holdings in the financial sector”, issued jointly by EBA, EIOPA and ESMA. Potential and existing shareholders should read this document in conjunction with Communication NBB_2017_22; credit institutions should read it in conjunction with Circular NBB_2017_23.
Charter of the family/partners
Credit institutions with a family shareholding or a shareholder structure comprising a restricted number of partners would do well to draw up a charter governing the relationships between the family or partners on the one hand and the institution on the other hand, as regards its sound governance, corporate vision, financial objectives, management follow-up, careers, remuneration, ...
No loans, credits or guarantees to acquire shares
No loans, credits or guarantees may be granted, directly or indirectly, to persons to enable them to directly or indirectly subscribe to shares or other securities that confer the right to dividends of the credit institution or of a company with which a close link exists or that confer the right to acquire such securities, or to acquire such shares or other securities. This type of transaction, where the repayment or cancellation of the resulting commitment depends to some extent on the payment of dividends by the credit institution, in fact undermines the loss absorbing capacity of the so funded capital.