Recital 5

(5)Directive (EU) 2019/879 of the European Parliament and of the Council ⁸ and Directive (EU) 2024/1174 of the European Parliament and of the Council ⁹ have extensively amended the minimum requirement for own funds and eligible liabilities (MREL) laid down in Directive 2014/59/EU. As a consequence of those amendments, MREL, originally construed as a general requirement applicable to all institutions, is to be tailored to each institution depending on the specific resolution strategy chosen for the institution or group of which the institution is part. Liquidation entities are not anymore subject to MREL and in case of groups, institutions may be or may not be subject to MREL depending on whether they are liquidation or resolution entities. In addition, MREL is to be composed of different financial instruments and is to be calibrated differently (external or internal MREL) depending on whether the institution is the point of entry for the resolution of the group or not. As a result, the risk indicator ‘Own funds and eligible liabilities held by the institution in excess of MREL’ laid down in Delegated Regulation (EU) 2015/63, as part of the risk pillar ‘Risk exposure’, which was designed for an MREL uniformly applicable to all institutions, is not anymore suitable to be applied to all institutions to adjust the contributions of those institutions in proportion to their risk profiles. In particular, that risk indicator might penalise liquidation entities, as they have no MREL. The risk pillar ‘Additional risk indicators to be determined by the resolution authority’, providing, among other things, for the resolvability risk indicator, takes more appropriately into account MREL for all institutions. The risk indicator ‘Own funds and eligible liabilities held by the institution in excess of MREL’ in the risk pillar ‘Risk exposure’, and related provisions and references, should therefore be deleted.