ECB Annual Report on supervisory activities

either or both of the following criteria: (a) material exposures which are more than
90 days past-due; (b) the debtor is assessed as unlikely to pay its credit obligations
in full without realisation of collateral, regardless of the existence of any past-due
amount or of the number of days past due.”
Options and national discretions (ONDs): options are provisions in EU law that
give competent authorities or Member States a choice on how to comply with a
provision selecting from a range of alternatives. National discretions are provisions
in EU banking law that give competent authorities or Member States a choice as to
whether or not to apply a given provision.
Overall capital requirements (OCR): the sum of the total SREP capital ratio (sum
of own funds requirements as set out in Article 92 of the Capital Requirements
Regulation and additional own funds requirements), capital buffer requirements and
macroprudential requirements.
Passporting procedures: procedures concerning the freedom of establishment
and the freedom to provide services in other Member States by any credit institution
authorised and supervised by the competent authorities of another Member State,
provided that such activities are covered by the authorisation (as regulated by
Articles 33 to 46 of CRD IV).
Pillar 2 guidance (P2G): a supervisory tool setting non-legally binding capital
expectations above the level of overall capital requirements (OCR). It is
complementary to Pillar 2 requirements (P2R). P2G is not MDA relevant and a
failure to meet Pillar 2 guidance does not result in automatic action by the
supervisor.
Qualifying holding: a holding in a credit institution which represents 10% or more
of the capital or of the voting rights or which makes it possible to exercise a
significant influence over the management of that credit institution.
Significant institution (SI): the criteria for determining whether banks are
considered significant – and therefore under the <strong>ECB</strong>'s direct supervision – are set
out in the SSM Regulation and the SSM Framework Regulation. To qualify as
significant, banks must fulfil at least one of those criteria. Notwithstanding the
fulfilment of the criteria, the SSM can decide at any time to classify an institution as
significant to ensure that high supervisory standards are applied consistently.
Single Supervisory Mechanism (SSM): a mechanism composed of the <strong>ECB</strong> and
national competent authorities in participating Member States for the exercise of the
supervisory tasks conferred upon the <strong>ECB</strong>. The <strong>ECB</strong> is responsible for the effective
and consistent functioning of this mechanism, which forms part of the banking
union.
SSM Framework Regulation: the regulatory framework setting out the practical
arrangements concerning the cooperation between the <strong>ECB</strong> and the national
competent authorities within the Single Supervisory Mechanism, as provided for in
the SSM Regulation.
<strong>ECB</strong> <strong>Annual</strong> <strong>Report</strong> on supervisory activities 2016 − Glossary 77