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13.7.2012 Official
Journal
of
the
European
Union L
182/37
DECISIONS
COUNCIL IMPLEMENTING DECISION
of 22 June 2012
amending Implementing Decision 2011/77/EU on granting Union financial assistance to Ireland
(2012/375/EU)
THE COUNCIL OF THE EUROPEAN UNION,
that the next stress test of the domestically-owned Irish
banks be postponed to 2013. In the meantime, the auth
Having regard to the Treaty on the Functioning of the European
orities have identified key preparatory work-streams,
Union,
which will be completed in 2012.
Having regard to Council Regulation (EU) No 407/2010 of
11 May 2010 establishing a European financial stabilisation
(5) The
Irish
authorities
have
identified
additional
measures
mechanism (
that they will undertake in 2012 to reduce

1 ), and in particular Article 3(2) thereof,
unemployment and underpin the attainment of the
Having regard to the proposal from the European Commission,
programme objectives. In particular, they will take steps
to increase the effectiveness of their labour market
activation and training policies and reduce any
Whereas:
potential for social payments to provide disincentives
for people able to take up work while protecting the
(1) Upon
a
request
by
Ireland,
the
Council
granted,
by
most vulnerable.
means of Implementing Decision 2011/77/EU
( 2 ),
financial assistance to it in support of a strong
economic and financial reform programme (‘the
(6) In
light
of
these
developments
and
considerations,
Imple
Programme’) aiming at restoring confidence, enabling
menting Decision 2011/77/EU should be amended,
the return of the economy to sustainable growth, and
safeguarding financial stability in Ireland, the euro area
and the Union.
HAS ADOPTED THIS DECISION:
(2) In
line
with
Article
3(9)
of
Implementing
Decision
2011/77/EU, the Commission, together with the Inter
Article 1
national Monetary Fund (IMF) and in liaison with the
European Central Bank (ECB), has conducted the sixth
Article 3 of Implementing Decision 2011/77/EU is amended as
review of the Irish authorities’ progress on the implemen
follows:
tation of the agreed measures as well as of the effec
tiveness and economic and social impact of those
measures.
(1) in paragraph 7, point (d) is replaced by the following:
(3) The
Irish
authorities
presented
to
Parliament
legislation
to enhance the long-term sustainability of the public
‘(d) the adoption of legislation to increase the state pension
finances in September 2011, as envisaged under the
age to 66 years in 2014, 67 in 2021, and 68 in 2028,
Programme. Some elements of the envisaged reform
with a view to enhancing the long-term sustainability of
were not adopted by Parliament by the end of the above
the public finances.’;
mentioned sixth quarterly review, in particular, as regards
pension entitlements for new entrants to the public
service, including a review of accelerated retirement for
(2) in paragraph 8, the following points are added:
certain categories of public servants and an indexation of
pensions to consumer prices, and the linking of pension
benefits to career average earnings and of retirement age
‘(f) the completion of the following work-streams in the
to state pension retirement age. The authorities have
domestically-owned Irish banks, on whose results the
committed themselves to securing the approval of these
Irish authorities will report to the Commission, the ECB
provisions by end 2012.
and the IMF: (i) an independent asset quality review to
assess the quality of aggregate and individual loan port
(4)
In light of the postponement of the EU-wide stress test
folios and the processes employed for establishing and
exercise carried out under the auspices of the European
monitoring asset quality; (ii) a distressed credit oper
Banking Authority to 2013, it is considered appropriate
ations review to assess the operational capability and
effectiveness of distressed loan portfolio management in
( 1 ) OJ L 118, 12.5.2010, p. 1.
the banks including arrears management and workout
( 2 ) OJ L 30, 4.2.2011, p. 34.
practices in curing non-performing loans (NPLs) and

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L 182/38
EN
Official Journal of the European Union
13.7.2012
reducing loan losses; (iii) a data integrity validation
shall be based on career average earnings. New entrants’
exercise to assess the reliability of banks’ data; and
retirement age shall be linked to the state pension
(iv) an income recognition and re-ageing project to
retirement age.’;
review existing practices against international financial
reporting standards (IFRS) and relevant regulatory
(3) the following paragraph is added:
guidance;
‘10. Ireland shall, in 2013 and in line with specifications
in the Memorandum of Understanding, complete stress tests
(g) the assessment of banks’ progress with the work-out of
of the banks that were included in the PCAR 2011. The
their non-performing portfolios;
stress test will be aligned to the European Banking
Authority (EBA) exercise, and build on the outcomes from
PCAR 2011 and the Financial Measures Programme 2012.
(h) the provision to the Commission, the ECB and the IMF
The stress test will be rigorous and continue to be based on
of an evaluation of the actions taken in respect of
robust loan-loss forecasts and a high level of transparency.
jobseekers payments recipients who do not attend
The publication of the results will coincide with the next
employment activation interviews;
EBA exercise.’.
Article 2
(i) the completion of a cross-departmental report to
explore the scope for attenuating any adverse
This Decision is addressed to Ireland.
employment incentives arising from the structure of
social payments;
Done at Luxembourg, 22 June 2012.
(j) the adoption of legislation reforming pension
entitlements for new entrants to the public service.
For the Council
This shall include a review of accelerated retirement
for certain categories of public servants and an
The President
indexation of pensions to consumer prices. Pensions
M. VESTAGER

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