(1) The Bank shall impose the specific liquidity requirements referred to in Regulation 35(1)(k) only where, on the basis of the reviews carried out in accordance with Regulations 32 and 33, the Bank concludes that an investment firm that does not meet the conditions for qualifying as a small and non- interconnected investment firm set out in Article 12(1) of Regulation (EU) 2019/2033 or that meets the conditions set out in Article 12 (1) of Regulation (EU) 2019/2033 but has not been exempted from liquidity requirement in accordance with Article 43(1) of Regulation (EU) 2019/2033 is in one of the following situations:

(a) the investment firm is exposed to liquidity risk or elements of liquidity risk that are material and are not covered or not sufficiently covered by the liquidity requirement set out in Part Five of Regulation (EU) 2019/2033;

(b) the investment firm does not meet the requirements set out in Regulations 21 and 23 and other administrative measures are unlikely to sufficiently improve the arrangements, processes, mechanisms and strategies within an appropriate timeframe.