Question ID:
Legal Act:
Regulation (EU) No 575/2013 (CRR)
Supervisory reporting - FINREP (incl. FB&NPE)
COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations:
Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)
Disclose name of institution / entity:
Type of submitter:
Consultancy firm
Subject Matter:
Performing FBE

In our view, “both” (not “either”) of the conditions a) and b) in paragraph 178 must be met. Do you agree?

Background on the question:

If just one of the conditions has to be fulfilled, a non-performing exposure for which a forbearance measure is extended would immediately be considered as performing, if the additional forbearance measure does not lead to impairment or default. And vice-versa: if the exposure has been performing prior to the extension of themeasure, it would continue to be considered performing even if the FBE-measure led to default or impairment. These results do not appear plausible.

Date of submission:
Published as Final Q&A:
Final Answer:
For the purposes of par. 178 of Annex V of Regulation (EU) No 680/2014 - ITS on Supervisory Reporting of institutions (ITS), both the conditions a) and b) have to be met in order to classify a forborne exposure as performing from the date when forbearance measures were extended.
The requirement for the both conditions to be met stems from the articulation of paragraph 178 with paragraphs 157 of the ITS:
- If an exposure is extended forbearance measures without this leading to the classification of non-performing (condition a is satisfied) but this exposure was already non-performing before the extension of forbearance measures (condition b is not satisfied): paragraph 157 precludes the reclassification of the forborne exposure as performing until specific conditions are met
- If an exposure is extended forbearance measures without being already non-performing (condition b is met) but this extension has lead such exposure to be classified as "non-performing" (condition a is not satisfied): the exposure cannot exit the classification of non-performing forborne without meeting the requirements in paragraph 157 (which applies to all non-performing exposures with forbearance measures according to Q&A 735)
Final Q&A
Answer prepared by:
Answer prepared by the EBA.