The Financial Supervisory Authority of Norway announced a further expansion of the group of banks that will be subject to a minimum requirement for own funds and eligible liabilities (MREL), with decisions on simplified MREL planned for five additional banks. It will also move OBOS-banken and Sparebanken Øst from full to simplified requirements, under which MREL decisions will not include either a market confidence buffer or a subordination requirement. The thresholds for imposing MREL are unchanged and around 20 banks could ultimately be required to meet MREL, but the authority is proceeding with a moderate initial expansion. The five banks that have been notified they will receive MREL decisions are Storebrand Bank ASA, Landkreditt Bank AS, BN Bank ASA, Sparebank 1 Helgeland and Sparebank 1 Ringerike Hadeland. For the affected banks, the authority will not require subordination and will remove the market confidence buffer from the recapitalisation element, aiming to ensure sufficient capacity for loss absorption (MREL Pillar 1 plus Pillar 2) and debt that can be converted into own funds for recapitalisation (Pillar 1 plus Pillar 2). The new MREL banks will have transfer as the preferred crisis management strategy and will be subject to simplified reporting and resolvability requirements. A three-year phase-in period will apply for the newly included banks to replace ordinary senior debt with MREL-eligible debt as it matures, with a possibility to apply for an extended transition period if needed. Any further expansion of MREL to additional banks will be assessed after the new firms have put MREL-eligible debt in place and not before 2028, and the authority will also consider whether more of the smallest banks currently subject to full MREL can be moved to the simplified regime at a later stage.
Norwegian Finanstilsynet 2025-09-05
Financial Supervisory Authority of Norway expands simplified MREL requirements to five banks and reclassifies OBOS-banken and Sparebanken Øst
The Financial Supervisory Authority of Norway is expanding the group of banks subject to the minimum requirement for own funds and eligible liabilities (MREL), adding five banks to the simplified regime. OBOS-banken and Sparebanken Øst will transition to simplified requirements, excluding a market confidence buffer and subordination requirement. A three-year phase-in period will allow newly included banks to replace senior debt with MREL-eligible debt, with further expansion assessments planned after 2028.