Opinion of the European Central Bank of 21 January 2010 on the second prolongation of the State recapitalisation scheme (CON/2010/11)
Date: 2010-01-21
Institutions: European Central Bank
Subjects: State aid, Sweden, bank, capital increase, financial stability, national law

EN 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 21 January 2010 

on the second prolongation of the State recapitalisation scheme 

(CON/2010/11) 

Introduction and legal basis 

On 13 January 2010 the European Central Bank (ECB) received a request from the Swedish Ministry of 

Finance for an opinion on a draft ordinance (hereinafter the ‘second amending Ordinance’) amending the 

Ordinance  on  capital  contributions  to  solvent  banks  and  others  (SFS  2009:46)  (hereinafter  the 

‘Ordinance’). 

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 the sixth indent of Article 2(1) of Council Decision 98/415/EC of 

29 June 1998  on  the  consultation  of  the  European  Central  Bank  by  national  authorities  regarding  draft 
legislative  provisions1,  as  the  amending  ordinance  relates  to  rules  applicable  to  financial  institutions 

insofar as they materially influence the stability of financial institutions and markets. In accordance with 

the first sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing 

Council has adopted this opinion. 

1.  

Background 

1.1  On  16 February  2009  the  ECB  received  a  request  from  the  Swedish  Ministry  of  Finance  for  an 

opinion on a draft version of the Ordinance, which entered into force on 17 February 2009. Due to 

this late consultation by the Swedish Ministry of Finance, the ECB was not afforded sufficient time 

to adopt an opinion on the Ordinance. 

1.2  The Ordinance was intended to contribute capital to solvent banks with the objective of facilitating 

the  provision  of  credit  to  the  real  economy.  The  Swedish  State  may  provide  capital  to 

fundamentally sound banks: 

1) 

either through a market transaction where the State subscribes up to 70% of a private issue 

on the same terms as other investors; or  

2) 

for  subscriptions  of  more  than  70%  of  an  issue,  through  an  instrument  and  on  terms 

determined by the State. 

1  

OJ L 189, 3.7.1998, p. 42. 

 
 
 
 
                                                 
Until now, the State has used the recapitalisation scheme only for Nordea Bank AB in the spring of 

2009, subscribing to its pro rata share, in accordance with its ownership, of the bank’s rights issue. 

1.3  On 30 June 2009 the ECB received a request from the Swedish Ministry of Finance for an opinion 

on a first prolongation of the Ordinance (hereinafter the ‘first amending Ordinance’) extending its 

validity  by  six  months  from  17 August  2009  until  17 February  2010.  On  14 July  2009  the  ECB 

adopted its Opinion CON/2009/58 on the first amending Ordinance. 

2.  

Purpose of the second amending ordinance 

The  current  second  amending  Ordinance’s  sole  purpose  is  to  extend  the  validity  of  the  Ordinance  by 

another six months from 18 February until 17 August 2010. 

3. 

General observations 

3.1 

In  its  Opinion  CON/2009/58,  the  ECB  already  commented  on  the  Ordinance  and  on  the  first 

amending Ordinance. To the extent relevant, the observations made in Opinion CON/2009/58 also 

apply to the proposed second amending Ordinance. 

3.2 

In  particular,  the  ECB  reiterates  that  any  initiatives  put  in  place  by  the  competent  national 

authorities to restore confidence in the financial markets should be coordinated and should aim to 

implement  common  principles  in  a  spirit  of  close  cooperation  with  other  Member  States  and  the 

Union institutions since significant differences in national implementation could create distortions 

in global banking markets. In this regard, the ECB emphasises that coordination of the duration of 

national  financial  support  schemes  across  the  Union  is  of  crucial  importance  in  order  to  ensure  a 
level  playing  field2.  In  addition,  the  ECB  notes  the  need  for  national  support  measures  to  be 
temporary in nature3.  

3.3  The consulting authority has informed the ECB that the draft law is to be adopted by 21 January 

2010. In view thereof, the consulting authority would seem to invoke the exemption provided for in 

Article  3(2)  of  Council  Decision  98/415/EC,  which  allows  for  a  reduction  of  the  minimum  time 

limit for submission of ECB opinions of one month in case of extreme urgency. The ECB wishes to 

draw  the  consulting  authority’s  attention  to  the  fact  that  the  second  sentence  of  Article 4  of 

Decision  98/415/EC  states  that  the  ECB  must  be  consulted  ‘at  an  appropriate  stage’  in  the 

legislative process. This implies that the consultation should take place at a point in the legislative 

process that affords the ECB sufficient time to examine the draft legislative provisions and to adopt 

its  opinion  in  the  required  language  versions  and  which  also  enables  the  relevant  national 

2  

3  

See notably ECB Opinions CON/2009/24, paragraph 3.1, CON/2009/54, paragraph 2.5.2, and CON/2009/73, paragraph 
3.2. All ECB opinions are available on the ECB’s website at ecb.europa.eu. 
See  notably  ECB  Opinions  CON/2009/24,  paragraph  2.2,  CON/2009/62,  paragraph  3.3,  and  CON/2009/73,  paragraph 
3.2, and CON/2009/92, paragraph 3.6. 

2 

 
 
 
                                                 
authorities  to  take  the  ECB’s  opinion  into  consideration  before  the  legislative  provisions  are 

adopted. 

This opinion will be published on the ECB’s website.  

Done at Frankfurt am Main, 21 January 2010. 

[signed] 

The President of the ECB 

Jean-Claude TRICHET 

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