In paragraphs 48 and 49, it is assumed that an instrument with an original maturity of at least 30 years may be included up to 15% of original own funds. Both the rules preceding the CEBS Hybrids Guidelines and the expected rules under the future CRD IV do not provide for Tier 1 qualification of instruments subject to redemption. What is the period observed by DNB?
DNB only accepts instruments with an indeterminate maturity (i.e. perpetual, not redeemable) and, hence, will not apply the exception provided for in paragraph 48.
DNB holds that the introduction of the possibility – for an expectedly short period – of issuing dated instruments is undesirable with a view to the continuity of policy. Tier 1 instruments must fundamentally be perpetual, although, subject to certain conditions, the presence of a call option is permitted (see paragraphs 58 to 69).
 Supervisory Regulation on the Recognition of Hybrid Instruments as Regulatory Capital Components (Regeling Gelijkstelling Hybride Instrumenten met Eigenvermogensbestanddelen) of 11 December 2007