Capital Requirements Directive IV
Compliance with Capital Requirements Directive (CRD IV)
Article 96 of CRD IV requires institutions to disclose information publicly on how to comply with the requirements with regard to governance, remuneration policy and reporting on their websites. The related articles can be found in Article 88 to 95 of CRD IV.
The requirements as set out in aforementioned articles are implemented through the Banks’ Policies and Procedures Manual (PPM), Profile outline for Management Board members, Profile outline for Supervisory Board members and Remuneration Policy. The remainder of this document confirms that Yapi Kredi Bank Nederland N.V. (hereafter; YKNV) complies with the aforementioned articles.
Governance
Management Board
The Management Board of YKNV defines, oversees and is accountable for the implementation of the governance arrangements that ensure effective and prudent management of an institution, including the segregation of duties in the organization and the prevention of conflicts of interest. The Management Board has the overall responsibility for the institution and approve and oversee the implementation of the institution's strategic objectives, risk strategy and internal governance.
The Management Board of the Bank consist of two members, the CEO and the Managing Director. These members are supported by managers of various departments.
The Management Board must ensure the integrity of the accounting and financial reporting systems including financial and operational controls, compliance with the law and relevant standards, providing effective oversight of senior management and overseeing the process of disclosure and communications.
The Management Board has sufficient knowledge and experience on all aspects of the Bank. The members have sufficient knowledge and experience in the financial sector and the banking sector in particular.
The Management Board members have weekly meetings regarding all relevant aspects of the Bank. Whenever needed, these meetings are held on a daily basis. The CEO is the chairman during these meetings. When taking a decision, a balanced commercial interest and the risk to be taken are taken into count, based on the risk appetite of the bank. The interest of stakeholders, clients and employees are also taken into count.
Management Board members of YKNV are appointed according to the Appointment Procedure for Management Board and Supervisory Board. Management Board members are being appointed by Yapı ve Kredi Bankasi A.Ş.
Supervisory Board
The Supervisory Board of the Bank consist of four members including two independent members. The Supervisory Board of the Bank is composed in such a way that it is able to perform their tasks properly.
The Supervisory Board of YKNV is responsible for providing effective oversight of the Management Board of the bank and possesses adequate collective knowledge, skills and experience to be able to understand the institution's activities, including the main risks of the bank. Each member of the Supervisory Board shall act with honesty, integrity and independence of mind to effectively assess and challenge the decisions of the Management Board where necessary and to effectively oversee and monitor management decision-making. The Supervisory Board members follow a life-long training program in order to maintain their knowledge regarding the market development, laws and regulations and risks of the bank.
All Supervisory Board members are appointed by Yapı ve Kredi Bankasi A.Ş. as the main shareholder, ensuring that these members have excellent skills and knowledge to perform their tasks. Besides the procedures performed by Yapı ve Kredi Bankasi A.Ş., YKNV performs screening procedures for Supervisory Board members.
Remunerations
In order to have credible, effective and fair remuneration that are consistent with and promote sound and effective risk management when achieving objectives YKNV implemented a Remuneration Policy. This policy is designed to support YKNV’s business strategies, objectives, core values and long-term interests. In order to achieve this YKNV’s Remuneration Policy consists of a combination of fixed compensation (base salary) and variable remuneration. Considering the size of the Bank, a separate Remuneration Committee is not established and relevant issues will be addressed by the Supervisory Board. The Supervisory Board approves the Remuneration Policy and is responsible for the yearly supervision on the compliance with this policy.
The Supervisory Board members receive a fixed compensation for their activities. The compensation doesn’t depend on the Bank’s or the group’s results. The total income of a member of the Managing Board is in reasonable proportion to the remuneration policy adopted by the Bank. Variable remuneration shall not exceed 20% of the annual salary.
There are no variable remunerations within the Bank with a long-term component. The variable remuneration is based on indicators which are mostly short-term corporate goals. There are no shares granted to members of the Managing Board. Variable remuneration is based on the performances of the individuals, his part of the business and the performance of the Bank as a whole according to predetermined and assessable performance criteria. The performance criteria are both financial as well as non-financial.
(a) Decision- making process to determine remuneration policy
The Supervisory Board is responsible for the establishment, execution and evaluation of the Remuneration Policy and monitoring the proper implementation of this by the Management Board. The Management Board prepares the decision making process for the Supervisory Board, taking into account the long-term interests of all stakeholders. For management members, remuneration is directly supervised by the Supervisory Board.
(b) Link between performance and pay
One of the key elements of the Remuneration Policy is the description of the appraisal process. In this paragraph, a summary is given of this process: On the basis of pre-determined and assessable objectives, comprising financial and non-financial elements, and also on the basis of competences and general indicators, an employee’s overall performance assessment is determined once per year. The nonfinancial objectives form a substantial portion of the total set of objectives for an employee.
(c) Most important characteristics of remuneration system
Apart from the governance structure and appraisal process, the Remuneration Policy also incorporates rules and guidelines for the setting and determination of variable remuneration for employees. Among others important principles are that variable pay is never guaranteed and that variable pay may never exceed 20% of the fixed salary. More details are described in the Remuneration Policy of the bank.
Reporting
Country by country Reporting
As per Article 89 of CRD IV each institution is required to disclose certain financial information per country in which it has an establishment. The requested information includes names and nature of activities and their geographical location along with basic financial figures of the institution. YKNV operates in the Netherlands on individual basis and meets its reporting requirements in accordance with this article in its annual report. The details can be found in the annual report on our website.
Reporting of Return on Assets
As per Article 90 of CRD IV institutions are required to disclose in their annual report among other key indicators their return on assets, calculated as their net profit divided by their total balance sheet. YKNV meets its reporting requirements in accordance with this article in its annual report. The details can be found in the Key Figures section of the annual report on our website.