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Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)
Annex V
Disclose name of institution / entity:
Name of institution / submitter:
Nationwide Building Society
Country of incorporation / residence:
United Kingdom
Type of submitter:
Credit institution
Subject Matter:
FINREP – Non-performing exposures during performing probation period

Clarification is requested surrounding non-performing probation periods. Scenario If a customer 19s exposure has previously had a concession event and has been classified as non-performing then they shall serve a 1 year non-performing probation period from the date of the concession event followed by a 2 year performing probation period (on the assumption they met all the exit criteria from non-performing probation). If the customer re-enters non-performing classification during the 2 year performing probation period, through: 1) Going more than 30 days past due; or 2) Non-performing as per any of the criteria per paragraph 145. a) Will the customer serve another 1 year non-performing probation? And if so, when would that non-performing probation period start from, as there has not been a new forbearance measure? b) Or would the customer go straight to a new 2 year performing probation period on the exit of non-performing criteria? Note: The scenario where customer becomes non-performing again due to a new concession event being issued (paragraph 179) is intentionally excluded from the above query. It is believed by the institution that this could only follow option a) above with a new non-performing probation period starting from the date of the new concession event.

Background on the question:

The ITS guidance states that "When forbearance measures are extended to non-performing exposures, the exposures may be considered to have ceased being non-performing only when all the following conditions are met: (b) one year has passed since the forbearance measures were extended;" Furthermore Question ID 2014_1018 reiterates that the "one year cure period starts running since the date when the forbearance measures were extended" rather than from the date of the exit of non-performance. Therefore, in the above scenario as there has not been a new forbearance measure issued to the customer, there is no prescribed start point of the second non-performing probation period and it is queried if one is required.

Date of submission:
Published as Final Q&A:
Final Answer:

The exposure has been reclassified into "non-performing forborne category" and all the exit criteria of paragraph 157  (including a mandatory one year probation period since the latest between the moment when forbearance measures were applied and the moment when exposures have been classified as non-performing) have to be met before the exposure can be reclassified into performing forborne (option a). The probation period starts from the date of reclassification in non-performing forborne exposure.

The instructions for Templates F 18.00 and F 19.00 of Annex III and IV of Regulation (EU) No 680/2014 - ITS on Supervisory Reporting of institutions (ITS on reporting) will be amended accordingly in the next available version of the ITS.

Final Q&A
Answer prepared by:
Answer prepared by the EBA.