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In this act Article 8 of 11

Article 8 — Internal governance arrangements under the stress testing exercises

Financial servicesLevel 2RTSMiCAIn forceOfficial source

8(1)

1.The stress testing programme of the issuer of asset-referenced tokens or e-money tokens shall be adopted by its management body, which shall be responsible for its implementation in accordance with this Regulation and with Regulation (EU) 2023/1114.

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8(2)

2.The stress testing programme shall include an assessment as to whether the members of the management body collectively have sufficient knowledge, skills and experience to perform all the following:

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8(2)(a)
a)fully understand the impact of stress events on the overall risk profile of the issuer;
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8(2)(b)
b)ensure that clear responsibilities and sufficient resources such as skilled human resources and information technology systems, have been assigned and allocated for the execution of the stress tests;
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8(2)(c)
c)actively engage in discussions with staff involved in stress testing and with persons to whom tasks related to stress testing are outsourced;
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8(2)(d)
d)challenge key modelling assumptions, the scenario selection and the assumptions underlying the stress tests in general;
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8(2)(e)
e)decide on the necessary management actions and discuss them with the competent authorities.\
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8(3)

3.The stress testing programme shall be designed in a way which allows stress tests to be executed in accordance with the relevant internal policies and procedures of the issuer.

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8(4)

4.Issuers of asset-referenced tokens or e-money tokens shall ensure that all elements of the stress testing programme, including its assessment, are appropriately documented and regularly updated, where relevant, in the internal policies and procedures.

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8(5)

5.Issuers of asset-referenced tokens or e-money tokens shall ensure that the stress testing programme design foresees an effective communication across business lines and management levels, with a view to raising awareness, improving risk culture and instigating discussions on existing and potential risks as well as on possible management actions.

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8(6)

6.The stress testing programme shall be designed as an integral part of an issuer’s risk management framework. Stress tests shall be designed to support different business decisions and processes as well as strategic planning. The strategic decisions shall take into account the shortcomings, limitations and vulnerabilities identified during stress testing.

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8(7)

7.The outputs of stress tests shall be used as inputs to the process of establishing an issuer’s risk appetite and limits and shall act as a planning tool to determine the effectiveness of new and existing business strategies and assess the possible impact on own funds and liquidity.

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