According to the template instructions from Annex II of Regulation (EU) No 680/2014 (ITS on Reporting), template 35.03 provides the calculation of the total minimum coverage requirements for non-performing forborne exposures that fall under Article 47c(6) of the Regulation (EU) No 575/2013, indicating the factors to be applied on the exposure values for the purposes of this calculation given whether the exposure is secured or unsecured and given the time since the exposure became non-performing.

Article 47c(6) of the Regulation (EU) No 575/2013 (CRR) establishes that “By way of derogation from paragraph 2, where an exposure has, between one year and two years following its classification as non-performing, been granted a forbearance measure, the factor applicable in accordance with paragraph 2 on the date on which the forbearance measure is granted shall be applicable for an additional period of one year”, and in the second sentence of Article 47c(6)   “By way of derogation from paragraph 3, where an exposure has, between two and six years following its classification as non-performing, been granted a forbearance measure, the factor applicable in accordance with paragraph 3 on the date on which the forbearance measure is granted shall be applicable for an additional period of one year”. This sentence shall only apply in relation to the first forbearance measure that has been granted since the classification of the exposure as non-performing, however.

This does not imply, as is specified by the submitter, that an exposure reported in template C 35.03 is not allowed to be reported for more than 12 months (one year after the first forbearance measure was realized), and after the end of the 12 months it shall be reported in template C 35.02. Template C 35.03 provides the information of those non-performing forborne exposures that have or had been granted a first forbearance measure between one year and two years (or between two and six years, respectively) following its classification as non-performing and, for that reason, benefited from the advantageous factor, that will apply/applied to its unsecured/secured part and that is/was applicable for an additional period of one year.

In the example given by the submitter, the exposure should be reported during the first year in template C 35.01 and C 35.02 and, as it is an unsecured exposure, the factor 0% applies. Then, between one year and two years, once it has been granted a forbearance measure, it shall be reported in template C 35.01 and C 35.03. The factor 0% will be applicable for an additional period of one year, that is, till the last day of the third year following its classification as non-performing.

As mentioned, the first paragraph on page 72 of the publication EBA/ITS/2020/05 reads that in template C 35.03 “exposures should be reported also after the period in which the coverage factors are kept stable, provided that they are still non-performing”. Hence, the exposure shall be reported in this template while all the conditions stablished by Article 47a (6) are met and until it ceases to be classified as non-performing for the purposes of point (m) of Article 36(1).