EN ECB-PUBLIC  
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 14 December 2012  
on asset management companies 
(CON/2012/108) 
 
Introduction and legal basis 
On 14 November 2012, the European Central Bank (ECB) received a request from the Spanish Secretary 
of State for Economic Affairs and Business Support for an opinion on a draft Royal Decree (hereinafter 
the ‘draft law’) on the legal regime fo r asset management companies (AMCs).  
The ECB’s competence to deliver an  opinion is based on Articles 127(4) and 282(5) of the Treaty on the 
Functioning of the European Union and on the thir d and sixth indents of Article 2(1) of Council 
Decision 98/415/EC of 29 June 1998 on the consu ltation of the European Central Bank by national 
authorities regarding draft legislative provisions1, as the draft law relates to the Banco de España and to 
rules applicable to financial institutions that material ly influence the stability of financial institutions and 
markets. In accordance with the firs t sentence of Article 17.5 of the Rules of Procedure of the European 
Central Bank, the Governing Council has adopted this opinion. 
 1. Purpose and contents of the draft law  
1.1 Legal framework 
The draft law implements Law 9/2012 of 14 Novemb er 2012 on restructuring and resolution of credit 
institutions
2, as regards the legal framework for AMCs in general and for the Asset Management 
Company for Assets Resulting from Bank Rest ructuring (hereinafter the ‘SAREB’).  
1.2 AMCs’ objectives  
Article 3 of the draft law provides that AMCs must pursue the following objectives: (i) help restore the 
financial system by acquiring impaired assets harmful to  the credit institutions’ balance sheets so that the 
associated risks are transferred to the AMCs; (ii) mi nimise public financial support; (iii) pay the debts and 
obligations incurred in the course of conducting their ac tivities; (iv) minimise potential market distortions 
resulting from their actions; (v) dispose of the acquired assets in such a way that their value is optimised. 
                                                 
1  OJ L 189, 3.7.1998, p. 42.  
2  BOE 275, 15.11.2012. 
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2 1.3 Roles of the Fund for Orderly Bank Restructuring and the Banco de España 
The Fund for Orderly Bank Restructuring (hereinafter the ‘FROB’)  defines the categories of assets to be 
transferred on the basis of pre-determined qualitative and quantitative criteria. The Banco de España may 
extend the criteria, define them more precisely and resolve doubts as to the inclusion of an asset in the 
defined categories. Once the valuation adjustments have  been made and the transfer value determined by 
the Banco de España, the FROB orders the definitive tr ansfer of the assets. The price to be paid for the 
assets is subject to valuation adjustments and criteri a, taking into account whether the assets are listed on 
an active market and whether they are real estate asse ts, credit rights or equity instruments. The Banco de 
España determines the final transfer value on the basi s of valuation reports by  independent experts in 
accordance with the valuation criteria set out in the dr aft law. The transfer value is expressed for each 
category of assets as a percentage of the book value af ter applying the required valuation adjustments. 
1.4  Regime applicable to the SAREB 
The draft law also lays down the regime applicable to the SAREB and its separate capital structures, the 
Bank Asset Funds, to which it may transfer its assets in order to facilitate the divestment procedure. 
The SAREB will be incorporated for a maximum peri od of 15 years as a public limited company with 
special features deriving from its unique corporate purpo se and the public interest nature of its activities. 
Its only purpose is the holding, direct or indirect management, acquisition and disposal of assets to be transferred to it by credit institutions receiving publ ic support. These institutions receive debt securities 
issued by the SAREB with a State guara ntee as payment for the assets transferred. 
The assets to be transferred will include foreclosed assets with a net book value over EUR 100 000 after 
applying the required adjustments, loans to r eal estate developers with a net book value over 
EUR 250 000 after applying the required adjustments, and controlling corporate holdings linked to the real estate sector. The SAREB will have a maximum financial limit of EUR 90 billion.  
Public participation in the SAREB will be below 50%, and it will have to meet certain corporate 
governance requirements. One-third of its Board will be  composed of independent members and it will be 
obliged to establish committees on audit, remuneration,  appointments, management, risks, investments 
and assets and liabilities. The board members of the SA REB will be obliged to meet strict requirements 
with regard to their professionalism, integrity and relevant experience.  
The SAREB will prepare a six-monthly activity repor t; an independent expert  will prepare an annual 
compliance report on the SAREB; and an external M onitoring Commission will be set up, and may agree 
to include permanent observers. The Monitoring Co mmission will oversee compliance with the SAREB’s 
general objectives, including, inter alia , helping restore the financial system by receiving the relevant 
assets so that, from the valuation date, there is an eff ective transfer of the risk s associated with these 
assets. In this role, the Monitoring Commission will receive the SAREB’s activity and compliance reports 
and may request, and have full access to, informati on from the SAREB relating to its business plan and 
deviations from it; policies on divestment and amortisa tion of guaranteed debt; its  economic and financial 
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3 situation or forecast; and any other information regarding assets, budget, accounts, organisation or 
procedures3. Regarding the obligation to give the Monito ring Commission full access to the requested 
information, the SAREB is subject to a penalty regi me under Law 26/1988 of 29 July 1988 on discipline 
and intervention of credit institutions4. In order to facilitate the performance of the Monitoring 
Commission’s functions, the Banco de España and, where appropriate, the National Securities Market 
Commission, must inform the Monitoring Commissi on of the main conclusions arising from their 
supervision of the SAREB5. 
 2. General observations  The draft law implements provisions which have b een adopted in the context of the Memorandum of 
Understanding on Financial-Sector  Policy Conditionality for Spain
6. The ECB welcomes this 
implementation as an important tool to facilitate the ongoing process of restructuring and recapitalising 
the Spanish banking sector.  
 3. Eligibility of SAREB debt securities as collateral in Eurosystem credit operations 
The ECB notes that participating banks will receive debt securities issued by the SAREB and guaranteed 
by Spain. Overall, the issuance of government gua ranteed securities should improve the liquidity position 
of Spanish banks. These securities are structured to meet the conditions set out in Guideline ECB/2011/14 
of 20 September 2011 on monetary policy instruments and procedures of the Eurosystem
7. The ECB 
would expect that as such the debt securities woul d be marketable, which could also contribute to 
increasing the possibility of Spanish banks to refina nce themselves in the mark et. As such, the SAREB 
scheme is expected to improve the overall funding s ituation of the Spanish banks. The ECB emphasises 
that it is the prerogative of the Eurosystem to deci de on the basis of any information it may consider 
relevant within the legal framework laid down in a nd according to Article 18.1 of the Statute of the 
European System of Central Banks and of the Eur opean Central Bank, whether collateral fulfils the 
criteria of its collateral framework.   
 4.  ECB’s role as observer in  the Monitoring Commission  
The Eurosystem has an interest in the successful functioning of the SAREB, insofar as the SAREB’s 
State-guaranteed debt securities may be eligible coll ateral in Eurosystem credit operations. The timely 
disposal of assets by the SAREB will facilitate the further deleveraging of pa rticipating banks’ balance 
sheets, thereby potentially reducing their reliance on Eurosystem credit operations. More generally, by 
                                                 
3  Article 27 of the draft law. 
4  BOE 182, 30.7.1998. 
5  Seventh Additional Provision , paragraph 9, of Law 9/2012. 
6  Available on the European Commission’s website at  http://ec.europa.eu. See paragraphs 9, 21 and 22. 
7  OJ L 331, 14.12.2011, p. 1. 
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4 facilitating the transfer of non-performing assets into a separate institution, asset re moval schemes such as 
the SAREB assist participating banks in restructuring their balance sheets, which should, in turn, improve 
their financial soundness. By facilitating banking sector restructuring and recovery, albeit by transferring 
risk from the banking sector to the State, such schem es should positively contribute to banks’ ability to 
extend credit and support economic recovery. In addition,  the value of the distressed assets may be better 
recovered when consolidated and ma naged by independent specialists. 
The ECB is ready to nominate a permanent observer to hold a seat in the Monitoring Commission in 
accordance with the Eurosy stem’s contribution, under Article 127(5) of the Treaty, to the smooth conduct 
of policies pursued by the competent authorities relati ng to the stability of the financial system. In this 
respect, the type of information and reporting the SA REB will be required to provide to the Monitoring 
Commission will need to be further developed and clarified, as the Monitoring Commission can only 
effectively fulfil its mandate with appropriate reporting from the SAREB. 
 5.  Prohibition on monetary financing  In order to avoid monetary financing concerns, the SAREB should not qualify as a public undertaking 
within the meaning of Council Regulation No 3603/ 93 of 13 December 1993 specifying definitions for 
the application of the prohibitions referred to in Articles 104 and 104b (1) of the Treaty
8. 
 6. Scope and capacity of the SAREB  The limitations with respect to the scope and capacity  of the SAREB are reasonable and consistent with 
its viability.  
 7. Pricing The methodology applied to derive the prices of asset s to be acquired by the SAREB appears appropriate 
and considered, and should lead to conservative pri ces, which in turn should minimise the risks to the 
vehicle in this respect. 
 8. Vendor financing The establishment of financing arrangements would grea tly facilitate asset disposals by the SAREB. As 
the SAREB is not a bank, it cannot extend credit to pot ential buyers to facilitate asset purchases, but will 
be competing with banks which offer such financing to buyers of foreclosed and distressed assets. The 
terms of such financing arrangeme nts should be competitive when comp ared with the terms offered by 
Spanish banks. 
 
                                                 
8  OJ L 332, 31.12.1993, p. 1. 
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5 9.  Dividend payments and application of excess cash holdings by the SAREB  
The draft law should be complemented by additional  arrangements to ensure the timely redemption of 
State-guaranteed bonds. This may be accomplished by imposing limitations on the payment of dividends 
by the SAREB and ensuring that all cash held by the SAREB beyond that required for short-term 
operating and capital expenses and other liquidity needs is applied to the early repayment of the SAREB’s 
State-guaranteed bonds. These arrangements should not affect  the pace of deleveraging – i.e. the pace at 
which assets will have to be disposed of – wh ich will depend on the business plan approved by the 
SAREB’s Board. 
 10.  Potential conflicts of interest  
Insofar as the SAREB’s capital come s from certain Spanish credit institu tions, care will need to be taken 
to avoid potential conflicts of interest that might  arise as these institutions may also have significant 
interests in the Spanish real estate sector. 
 This opinion will be published on the ECB’s website.    Done at Frankfurt am Main, 14 December 2012 
 
[signed] 
 
The Vice-President of the ECB 
Vítor CONSTÂNCIO