Interpretation on shares as repayable funds

In accordance with the Financial Supervisory Authority’s interpretation, repayable funds as referred to in the Credit Institutions Act include shares offered for subscription to the public that the issuing company engaged in lending activity has undertaken to redeem from the subscriber on demand. The interpretation has taken into account the fact that the shares in question function as a debt instrument. The interpretation does not express a view on the authorisation requirement of individual operators’ activities but if the companies’ activities also in other respects meet the characteristics of the authorisation requirement set out in law, the companies must apply for an authorisation.

The FIN-FSA has drawn attention to unauthorised companies engaged in lending activities which finance their activities by offering their shares to the public. The companies have undertaken to redeem the shares from the shareholders on demand at the subscription price. The generally applicable characteristics of debt are also associated with the shares.

The FIN-FSA supervises enforcement of credit institution regulation together which the European Central Bank.

The interpretation will apply from 30 September 2019. The interpretation does not apply to shares issued prior to the date of application of the interpretation.

The interpretation and the opinions received in its drafting can be found in Finnish on the Financial Supervision Authority's website. The interpretation is published also in Swedish.

Further information:

Sonja Lohse, Head of Unit, Chief Adviser

Requests for interviews are coordinated by FIN-FSA Communications, tel. +358 9 183 5030, weekdays 9.00–16.00.