Clarification is requested as to when group (connected) accounts should be downgraded to the Non Performing category (NPL) when only one party from within this group classifies as an NPL (refer to the 2nd part of para. 155). Should group facilities be downgraded: 1. When exposures past-due by more than 90 days represent 20% of the gross carrying amount of a singly debtor (one party within group entities) or 2. When exposures past-due by more than 90 days represent 20% of the gross carnying amount of the total group exposure? or is this left at the discretion of the credit institution?
The 20% threshold of past-due amount which entails the classification of the debtor as non-performing in accordance with Annex V, Part 2, paragraph 155 of Regulation (EU) No 680/2014 (ITS on Supervisory Reporting) is assessed at the individual level. No threshold is required at the consolidated level of a group, where the consequence of a failure of a group member shall be evaluated by the reporting institution on a case-by-case basis.