In order to determine the qualifying own funds for the different own funds elements (Common Equity Tier 1, Additional Tier 1 and Tier 2 capital), according to sub 1 of Articles 84, 85, 86, 87, 89, capital requirements should be taken into account. Suppose, the qualifying own funds of a non-regulated entity within the CRR scope of consolidation should be determined. Is our interpretation correct that, given the fact that no capital requirements exists for a non-regulated entity, the outcome of the calculation of the qualifying own funds of a non-regulated entity according to Articles 84, 85, 86, 87, 89 always equal zero?

It is not clear to us how to deal with qualifying own funds (columns 300-340) of non-regulated entities within the CRR scope of consolidation.

The question refers to two different aspects: the qualified own funds of non-regulated entities and the capital requirements of non-regulated entities.

• Qualified own funds of non-regulated entities (the "background of the question" asks how to deal with qualified own funds of non-regulated entities): According to Article 82(a) of Regulation (EU) No 575/2013 (CRR), qualifying own funds are only eligible if the entity is a subsidiary listed in (i) and (ii). Due to this limited scope, qualified own funds of non-regulated entities do not exist, which is why no amount shall be reported  for those entities in columns 300-340 in template C 06.00.

• Capital requirements of non-regulated entities. Capital requirements of non-regulated entities exist on consolidated level (i.e. such entities contribute to the group risk and columns 250 to 290 of template C 06.00 should be filled in) but not on individual level.