Fit and proper assessments
As one of its legal duties De Nederlandsche Bank (DNB) assesses whether incumbent and prospective management and supervisory board members are fit to occupy their position and whether their propriety is beyond doubt.
Our supervision is intended to ensure strong and sound financial institutions that meet their obligations. Assessments can make a significant contribution to this objective. Management and supervisory board members are essential to an institution’s strategy and corporate culture, and hence also to its soundness and future viability.
Please submit your application form through Supervision applications on My DNB.
Significant banks have to use the form that is available on the Digital Portal from the SSM (IMAS- Portal). See the link to the page European law and SSM consequences.
Individuals to be assessed
The following individuals will be assessed on fitness and/or propriety.
Anyone involved in daily policymaking or co-policy making, including at least an institution’s management board members.
- Day-to-day policymakers of a holder of a qualifying holding
- Members of an institution's supervisory body, such as a supervisory board or committee.
- Individuals applying for a declaration of no-objection (DNO) for holding or acquiring a qualifying holding.
- Individuals holding a qualifying holding for which no DNO is required, as is the case with individuals at trust offices
- Members of an investment committee (pension funds)
- Members of a stakeholders’ body (pension funds)
- Legal representatives (insurance companies)
- Second-tier management (banks and insurers)
Responsible supervisory body in the Netherlands
The assessments are performed by DNB or the AFM depending on the type of institution.
- Candidates are assessed by DNB if their proposed position is with one of the following institutions:
- central clearing counterparty
- clearing institution
- credit union
- crypto service provider
- dispensation holder (Section 3:5 of the Wft), such as a credit union as meant in Section 1:1 of the Wft
- electronic money institution
- exchange institution
- financial holding company
- financial institution
- funeral expenses and benefits in kind insurer
- general pension fund
- insurance holding company
- investment holdings
- life insurer
- mixed financial holding company
- non-life insurer
- occupational pension fund
- payment institution
- payment processing service provider
- pension fund
- premium pension institution
- small-scale mutual association
- special purpose reinsurance vehicle
- trust office
- ultimate beneficial owner
- Candidates are assessed by the AFM if their proposed position is with one of the following institutions:
- audit firms
- central securities depositories
- financial service providers
- investment companies
- investment firms
- investment fund managers
- pension custodians, market operators
- third-country accounting
- UCITS custodians
- UCITS managers
- undertakings for collective investment in transferable securities (UCITS)
DNB and the AFM work closely together on the assessments, but form their opinions independently. If either authority arrives at a negative opinion, both institution and candidate will receive a provisional negative decision. Both the institution and the candidate may present their views in response to a provisional decision.
Time of assessment
Initial fitness or propriety assessments take place upon the proposed appointment of a management or supervisory board members at a supervised institution. In case of an initial assessment, candidates are allowed to occupy their new positions only after receiving a positive decision on their fitness and/or propriety from the supervisory authority.
A fitness assessment is linked to a particular position. This means that a fitness assessment is required for all proposed appointments. This also applies if an incumbent management or supervisory board member who has been assessed previously changes their position or remit within the same institution.
As a rule, Propriety assessments are one-time procedures. This means that there are no reassessments of propriety, unless facts or circumstances come to light that may reasonably be relevant to the assessment of the person's propriety.
Assessment of an individual's reputation is linked to a qualifying holding in a financial enterprise. This means that a reputation assessment takes place when a holding is acquired or enlarged.
In exceptional circumstances DNB may decide to initiate an assessment of an incumbent management or supervisory board member. This may be an assessment of fitness or propriety, or both. Such a reassessment will only take place if facts or circumstances arise that provide reasonable grounds for revisiting a previous assessment.
DNB will charge a fee from the moment that an assessment application is submitted. This fee is also charged if an assessment is withdrawn or if the application proves incomplete and is not completed before the deadline. The Financial Supervision Funding Act (Wet bekostiging financieel toezicht) sets the fee for taking into consideration an application for an initial fitness assessment at EUR 2,000. The fee for an initial propriety assessment is EUR 1,100.
Most individuals joining a financial institution and whose fitness is assessed will also be required to take the oath or affirmation. New employees of financial institutions must take the oath or affirmation for the financial sector within three months following their appointment. As this is based on the Financial Supervision Act (Wet op het financieel toezicht – Wft), the oath or affirmation does not apply to management and supervisory board members of pension funds and trust offices.
Please contact DNB’s Expert Centre on Fit and Proper Assessments at Toetsing.Expertisecentrum@dnb.nl if you have any questions.
- Assessing fitness
- Propriety assessment
- Reputation assessment
- Reputation assessment ultimate beneficial owner
- Documents to be submitted
- Climate-related risks are now a part of fit and proper assessments
- Change in position
- Initial assessment in the context of a DNO application – documents to be submitted
- The assessment interview
- Diversity and collectivity
- Forms and formats
Video explaining out fit and proper assessment procedure
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