The rationale behind the different terminology in Articles 43(2)(b)(i) and 43(2)(b)(ii) of Directive 2014/59/EU (BRRD) is that a bridge institution is expected to comply with requirements of Directive 2013/36/EU (CRD IV) and Directive 2014/65/ EU (MiFid)  (Article 41(1), second paragraph, BRRD) and, therefore, it needs to be ensured that it is recapitalised accordingly. Under the sale of business tool situation, the purchaser may have other avenues for raising capital, if necessary. Under the asset separation tool situation, Article 46(2) BRRD requires that assessment of bail-in amount shall take into account a prudent estimate of the capital needs of asset management vehicle as appropriate.                                                                                                                                                                                                            

As regards the question on transferring shareholders of the institution under resolution to a bridge institution, other provisions of the BRRD, including those of Articles 47 and 59, shall be complied with. Article 59 requires that write down or conversion of capital instruments should be carried out before any resolution action (such as bridge institution tool) is taken, on the basis of valuation under Article 36. As a result of the valuation, existing shares are cancelled or diluted as a result of application of conversion power (in accordance Article 47). The requirement that the bridge institution is wholly owned by the public authorities is not relevant if the institution has been fully recapitalised by shareholders and creditors.

This question goes beyond matters of consistent and effective application of the regulatory framework. A Directorate General of the Commission (Directorate General Financial Stability, Financial Services and Capital Markets Union) has prepared the answer, albeit that only the Court of Justice of the European Union can provide definitive interpretations of EU legislation. This is an unofficial opinion of that Directorate General, which the European Banking Authority publishes on its behalf. The answers are not binding on the European Commission as an institution. You should be aware that the European Commission could adopt a position different from the one expressed in such Q&As, for instance in infringement proceedings or after a detailed examination of a specific case or on the basis of any new legal or factual elements that may have been brought to its attention.