As regards point (b) of Article 46(1) of Directive 2014/59/EU (BRRD), reference to ”other types of capital instruments” should be read together with ”in order to restore the Common Equity Tier 1 capital ratio […]”.

Article 2(1)(68) of Directive 2014/59/EU (BRRD) which defines Common Equity Tier 1 instruments also refers to capital instruments that meet certain eligibility conditions specified in Regulation (EU) No 575/2013 (CRR). Therefore, the language of point (b) of Article 46(1) of Directive 2014/59/EU (BRRD) is appropriate, so that eligiblebail-inable liabilities must be converted into instruments (whether “capital instruments” or “other instruments of ownership”) which are eligible for Common Equity Tier 1.

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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.