When assessing whether arrangements are in place which ensure that an IPS is able to grant the support it has committed to provide from funds readily available to it under Article 113(7)(b) of Regulation (EU) No 575/2013, the NCAs shall take into account whether:
the arrangements include a broad range of measures, processes and mechanisms, making up the framework under which the IPS operates. This framework should comprise a series of possible actions, ranging from less intrusive to more substantial measures that are proportionate to the riskiness of the beneficiary institution and the severity of its financial constraints, including direct capital and liquidity support. The support may be conditional, for example on the implementation of certain recovery and restructuring measures by the institution;
the IPS's governance structure and the process for making decisions on support measures allow support to be provided in a timely manner;
a clear commitment exists to provide support when, despite previous monitoring of risks and early intervention measures, a member is or is likely to become insolvent or illiquid and to ensure that its members abide by the relevant regulatory own funds and liquidity requirements;
the IPS conducts stress tests at regular intervals to quantify potential capital and liquidity support measures;
the IPS's risk-absorbing capacity (consisting of paid-up funds, potential ex post contributions and comparable commitments) is sufficient to cover potential support measures taken in respect of its members;
an ex ante fund has been created to ensure that the IPS has funds for support measures readily available, and
contributions to that fund follow a clearly defined framework;
the funds are invested only in liquid and secure assets that may be liquidated at any time and whose value does not depend on the solvency and liquidity position of the members and their subsidiaries;
the IPS's stress test results are considered for the determination of the minimum target amount of the ex ante fund;
there is an adequate floor/minimum amount for the ex ante fund to ensure the prompt availability of the funds.
IPSs may be recognised as deposit guarantee schemes pursuant to Directive 2014/49/EU of the European Parliament and of the Council 7 and may be allowed under the conditions set out in the relevant national law to use the available financial means for alternative measures to prevent the failure of a credit institution. In this case the NCAs shall consider the available financial means when assessing the availability of funds to grant support, taking into account the different purposes of IPSs, which aim to protect their members, and deposit guarantee schemes, whose key task is to protect depositors against the consequences of the insolvency of a credit institution.