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Q&As refer to the provisions in force on the day of their publication. The EBA does not systematically review published Q&As following the amendment of legislative acts. Users of the Q&A tool should therefore check the date of publication of the Q&A and whether the provisions referred to in the answer remain the same.

Please note that the Q&As related to the supervisory benchmarking exercises have been moved to the dedicated handbook page. You can submit Q&As on this topic here.

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List of Q&A's

Repurchase and cancellation of Tier 2 in the open market less than 5 years from issue

Can you please confirm if Article 78(4) is meant to apply only to the redemption of T2 securities within 5 years of issuance (as specified in the terms and conditions of the instrument), or if it also prohibits the use of liability management exercises to repurchase (and cancellation) T2 notes at market levels within 5 years of the issuance.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_290
  • Topic: Own funds
  • Date of submission:

Definition of threshold

Definition of threshold. Should bonds be considered in the calculation of the 1mln/€ threshold?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_289
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 02/10/2015

Definition of retail deposits.

Can the EBA confirm that retail bonds (both retail and small business) can be treated as retail deposits?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_288
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 23/10/2015

Reporting frequency for template C17.00 Op risk details

Please elaborate which reporting period that should be included in the semi-annual reporting of template C017.00. According to the Annex II, part 4.2 paragraph 119 this template summarises the information by an institution in the last year. If it should be reported with a semi-annual report, which reporting period should then be included in the reporting as per end Dec resp. end June? Possible way to read this: - The same figures should be reported twice a year (just as template C16.00 contains the same figure for four quarters in row). - Rolling 12 month reporting (i.e. as per end June is 1/7 the previous year until 30/6 the reporting year)

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)
  • ID: 2013_285
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 14/02/2014

Assets controlled by a liquidity management function

Would only those assets which are directly controlled by the liquidity management function fall within the definition of liquid asset holdings (subject to meeting the other conditions) under Regulation (EU) No 575/2013 (CRR), or do those assets which are not directly controlled by the liquidity management function also qualify?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_280
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 24/01/2014

Treatment of repos and reverse repos collateralised by commodities

The current guidance for Section 1.6 of the reporting template, Monies due from secured lending and capital market driven transactions as defined in Article 192, contains the following statement: 'Therefore, any transaction in which the institution has provided a collateralised loan in cash, such as reverse repurchase transactions as defined in Article 4(59) of Regulation (EU) No 575/2013, expiring within 30 days, shall be reported in this section'. The ITS guidance states that this section relates to rows 120-930, however we not believe that these rows contain categories that cover the treatment of repos and reverse repos collateralised by commodities stocks such as aluminium, nickel, carbon credits etc. Clarification is therefore needed on the reporting of such transactions.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)
  • ID: 2013_277
  • Topic: Supervisory reporting - Liquidity (LCR, NSFR, AMM)
  • Date of submission:
  • Published as final Q&A: 30/04/2014

Reporting of repos and reverse repos with underlying liquid asset collateral

Clarification on the reporting of repos and reverse repos with underlying collateral which is eligible for inclusion in the liquid asset buffer is needed. In particular, CRR Article 416 allows for unencumbered assets obtained through reverse repo transactions to be included within the pool of liquid assets and greater clarity is needed therefore on how these should be reported on C51.00 and C53.00.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)
  • ID: 2013_274
  • Topic: Supervisory reporting - Liquidity (LCR, NSFR, AMM)
  • Date of submission:
  • Published as final Q&A: 28/03/2014

Value adjustments for prudent valuation (Additional Value Adjustments)

Article 34 of Regulation (EU) No. 575/2013 (CRR) requires institutions to apply a deduction from CET1 the amount of any additional value adjustments on all assets measured at fair value calculated in accordance with Article 105. Article 105(14) of the CRR specifies that the EBA shall submit draft regulatory technical standards to the Commission by 28 July 2013 (as per CRR corrigendum published on 2 August 2013). In this regard the EBA published a draft consultation paper (EBA/CP/2013/28) whereby it is specified that "as a consequence of the EBA decision to conduct a QIS, the EBA currently envisages to finalise the technical standard in Q2 2014". Therefore it is not clear as concerns the first reporting date on Q12014 whether institutions must: 1) not apply the prudential filter (i.e. the relative reporting item shall be valued zero) until the publication of the final EBA RTS 2) calculate the prudential filter in accordance with the Basel II framework (i.e. requirements for prudent valuation defined by each local regulator) 3) calculate the prudential filter in accordance with the draft EBA standards as defined in consultation paper EBA/CP/2013/28

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_273
  • Topic: Market risk
  • Date of submission:

Continuation of current liquidity waivers

Clarification is needed as to the interim arrangements pending the introduction of the waiver/group treatments provided for under Article 8 of Regulation (EU) No. 575/2013 (CRR).

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_270
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 25/04/2014

Use of Core Market Participants Rule

This question regards the use of the Core Market Participants rule (Article 227 of Regulation (EU) No 575/2013 (CRR)) in the context of Master Netting Agreements with Own Estimates of Volatility (Article 220). The rule detailed under Article 227 of CRR specifically excludes only the Internal Models Approach for Master Netting Agreements (Article 221), and is consistent with the Basel II text (June 2006) in which paragraph 170 excludes the same approach in paragraphs 178-181. However, paragraph 177 of the June 2006 text provides for repo-style transactions under master netting agreements to have haircuts calculated in accordance with paragraphs 147-172, inclusive of the core market participant rules. This is in contrast to the CRR, where article 220(1) is only inclusive of the volatility adjustments detailed in Articles 223-226, thereby excluding the core market participant rule. The question is whether this exclusion in the final CRR was intentional or an oversight.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_269
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 08/11/2013

Holdings of own funds instruments issued by financial sector entities included in the scope of consolidated supervision not deducted from own funds on an individual basis

According to Article 49(2) of Regulation (EU) No. 575/2013 (CRR) “for the purposes of calculating own funds on an individual basis and a sub-consolidated basis, institutions subject to supervision on a consolidated basis in accordance with Chapter 2 of Title II of Part One shall not deduct holdings of own funds instruments issued by financial sector entities included in the scope of consolidated supervision, unless the competent authorities determine those deductions to be required for specific purposes, in particular structural separation of banking activities and resolution planning. Such provisions mean, if understood correctly, that starting from 1 January 2014, all significant investments in financial entities of a bank subgroup will not be deducted from own funds on an individual basis, but according to Article 49(4) of the CRR will be risk weighted according to Article 133 (for standardised approach). With the above in mind, what risk weight should be applied for such exposures? According to Article 133(2) of the CRR “equity exposures shall be assigned a risk weight of 100 %, unless they are required to be deducted in accordance with Part Two, assigned a 250 % risk weight in accordance with Article 48(4), assigned a 1250 % risk weight in accordance with Article 89(3) or treated as high risk items in accordance with Article 128.” In Article 133(2) of the CRR there is no reference to equity exposures treated under Article 49(2). Does this mean that such exposures should be treated simply with 100% risk weight?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_268
  • Topic: Own funds
  • Date of submission:
  • Published as final Q&A: 31/01/2014

January and February 2014 figures for the Q1 2014 leverage ratio reporting

Does the leverage ratio Q1 2014 reporting should include January 2014 and February 2014 data

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)
  • ID: 2013_266
  • Topic: Supervisory reporting - Leverage ratio
  • Date of submission:
  • Published as final Q&A: 14/02/2014

Risk Retention

Can the retention requirements under Article 405 of Regulation (EU) No 575/2013 (CRR) be satisfied by the provider of the junior/first loss funding for a CLO warehouse where such an entity has also been involved in the selection of the exposures and the setting of criteria, as it can be said, in such capacity, to be acting as "originator"? Also, where the warehouse provides financing for the acquisition of the majority of the exposures but further exposures are acquired from different sources after closing (and in accordance with pre-defined criteria), will this prevent the first loss warehouse provider from being the "originator"?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_265
  • Topic: Securitisation and Covered Bonds
  • Date of submission:
  • Published as final Q&A: 20/02/2015

Group solvency template - columns 300 until 340

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?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)
  • ID: 2013_263
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 14/02/2014

Group solvency template - columns 120, 130 and 140

Annex I of the ITS on reporting (Own funds templates) states that the figures to be reported in column 120 (Own funds) of the Group Solvency template should be equal or equivalent to the own funds reported in row 0010 of the template CA1. We conclude from that, that column 120 of the Group Solvency template should comprise all Tier 1 and Tier 2 capital of the entity the respective row refers to. From Annex I of the ITS on reporting (Own funds templates) we understand that column 130 of the Group Solvency template should reflect instruments (including related retained earnings, share premium accounts and other reserves) that are owned by persons other than the undertakings included in the CRR consolidation. From the same ITS and its reference to Article 87 (i)(b) of CRR we assume that column 140 relates to all own funds instruments of the subsidiary that are included in Common Equity Tier 1, Additional Tier1 and Tier 2 items and the related share premium accounts, the retained earnings and other reserves. We assume that the difference between the figures to be reported in column 120 and 140 of the Group Solvency template is that column 120 reflects all Tier 1 and Tier 2 capital of the entity the respective row refers to, whereas in column 140 only the part of Tier 1 and Tier 2 capital that is included in the consolidated own funds of the reporting entity, should be reported. Could EBA confirm that this assumption is correct?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)
  • ID: 2013_262
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 14/02/2014

Consistency regarding the specification of the transition period according to Articles 469(1), 470(2) and 478(2) CRR

How can the applicable percentages of Article 478(2) CRR be applied for the purposes of Article 469(1)(c) CRR until 31.12.2023 provided that the provisions of Article 469(1)(c) and Article 470(2) CRR are applicable only until 31.12.2017?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_261
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Applying the two different applicable percentages of Articles 478(1) and 478(2) CRR to the amount exceeding the thresholds of Article 470(2) CRR

How should the two different applicable percentages of Articles 478(1) and 478(2) CRR be applied to the total amount required to be deducted according to Article 36(1)(c) and (i) CRR after applying Article. 470 CRR?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_260
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Applicable provisions for determining deferred tax assets that rely on future profitability that existed before 1.1.2014

Are the provisions of Article 26(2) CRR regarding independently verified financial statements and permission of competent authorities applicable for determining deferred tax asset that rely on future profitability that existed before 1.1.2014?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_259
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Applicable basis for determining deferred tax assets to be deducted from CET1

Is the amount of deferred tax assets and liabilities relevant for the calculation of the amount to be deducted from Common Equity Tier 1 (CET1) according to Article 36(1)(c) of Regulation (EU) No. 575/2013 (CRR) to be determined based on the accounting values of deferred tax assets and liabilities as disclosed in the balance sheet?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_258
  • Topic: Own funds
  • Date of submission:
  • Published as final Q&A: 30/04/2014

Calculation of capital requirements for SME under Article 501 of CRR

How should the capital requirements be calculated for SME exposures according to Article 501 of Regulation (EU) No 575/2013 (CRR)? In essence we are asking if the risk weighted assets for qualifying SMEs should be reduced or only the capital requirements for qualifying SMEs.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_257
  • Topic: Credit risk
  • Date of submission: