Question
Does a financial institution need to have multiple subsidiaries to meet the definition of a financial holding company?
Background on the question
According to the definition in Art. 4 (1) Nr. 20 CRR, a “financial holding company” means a financial institution, the subsidiaries of which are exclusively or mainly institutions or financial institutions, and which is not a mixed financial holding company. The terminology used within this definition, especially the term “subsidiaries” in plural form, could support the interpretation that there must exist more than one subsidiary in order to qualify as a financial holding company. Therefore, it is unclear if the plural form of "subsidiaries" is an intentional exception to the definition of a financial holding company.
Answer
This question has been rejected because it is addressed in Article 4(1)(2) of Regulation (EU) No 575/2013, which is in the process of being revised and the issue it raises will either be no longer relevant in the light of the amendments introduced by the EU Banking Package or it will need to be reconsidered in regard to the new regulatory framework.For further information on the purpose of this tool and on how to submit questions, please see “Additional background and guidance for asking questions”.