In the context of the legal fit & proper provisions, the notion of “senior management” plays an important role. It is defined in Article 1, 11° of the Regulation of the NBB of 9 November 2021 on the exercise of external functions by managers and persons responsible for independent control functions of regulated companies.

According to this definition, a senior manager is a person who takes part in the institution’s senior management, i.e.:

1. where a management committee is set up, a member of the management committee and any other person whose position is at the next lower hierarchical level, insofar as that person can have a direct and decisive influence on the management of all or some of the institution’s activities, including the managers of foreign branches;
2. where such a committee is not established, any persons who can have a direct and decisive influence on the management of all or some of the institution’s activities.

The senior management thus consists of the members of the management committee and the persons at a hierarchical level immediately below that of the management committee (the so-called MC‑1 level), insofar as these persons can have a direct and decisive influence on the management of all or some of the institution’s activities.

Where, in accordance with Article 26 of the Banking Law, the institution has not set up a management committee as a result of a derogation authorised by the supervisory authority, "senior management” is understood to mean the executive directors and the persons who, without having the capacity of director, are qualified as senior managers by the institution due to the direct and decisive influence they can exercise over the management of all or some of the institution’s activities.

Furthermore, pursuant to Article 86 of the Banking Law, the managers of foreign branches (within the EEA or in a third country) are also part of the senior management.

Persons responsible for independent control functions are not considered to be senior managers in the exercise of these functions, as they require an independence that is incompatible with the decision-making power which is intrinsic to the activities of the institution.

The institution itself must decide who will be part of the senior management. For several years now, the supervisory authority has recommended that the management committee or, in the absence of a management committee, the statutory governing body draw up a list, by formal decision, of the names and/or functions of the persons who, without being directors, are qualified as senior managers.

Although all senior managers must possess the qualities listed in Article 19 of the Banking Law, the appointment - in institutions which have a management committee - of senior managers who are not members of the management committee or of the statutory governing body, must not be notified in advance nor submitted for approval to the supervisory authority. This concerns in particular the persons at a hierarchical level immediately below that of the management committee, who have a direct and decisive influence over the management of all or some of the institution’s activities (MC‑1 level). These persons must have the qualities required of senior managers pursuant to Article 19 of the Banking Law. It is in the first place the institution itself that should ensure this is the case. However, as clarified in the NBB’s Fit & Proper Manual, the supervisory authority does not verify in advance whether these persons meet the said requirements pursuant to Article 60 of the Banking Law. Instead, this verification is part of the ongoing supervision of the institution.