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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

Dutch Residential Real Estate Mortgages - covered by NHG - Nationale Hypotheek Garantie - National Mortgage Guarantee - Calculation of RWA within and outside the Netherlands

If a foreign bank, with a Dutch branch, is exempt from applying the rules from the Dutch NCA for the branch, would this not lead unfair competitive advantage?  

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2021_6105
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 29/04/2022

Direct and indirect funding of capital instruments

Is Article 9(1)(c) of Commission Delegated Regulation 241/2014 (RTS) applicable to the funding granted to a borrower that passes the funding on to the ultimate investor for the purchase of an institution’s capital instrument which had been issued and acquired before the funding was granted (e.g. refinancing of the purchase)? The same issue may be raised with reference to Article 8(2) and 8(3) of RTS.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 241/2014 - RTS for Own Funds requirements for institutions
  • ID: 2021_6165
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 22/02/2022

Consent solicitation to change the contractual ranking of an instrument to avoid so-called “infection risk“ posed by legacy instruments

Would a consent solicitation to amend the T&Cs of a legacy capital instrument (Tier 1 or Tier 2) in order to ‘promote’ an instrument in the subordination hierarchy entail the instrument to be deemed as a new issuance?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2020_5653
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 22/02/2022

Consent solicitation to introduce a contractual recognition of bail-in in Terms of Conditions (T&Cs) of capital instruments and MREL eligible liabilities

Would a consent solicitation to amend the T&Cs of a capital instrument (AT1, Tier 2) or MREL eligible liability (Senior Non Preferred, Senior Preferred or Senior HoldCo) in order to introduce a contractual recognition of bail-in be deemed a ‘material change’, in which case the amended instrument would be deemed as a new issuance?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2020_5227
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 22/02/2022

Is a tied agent of the investment firm a financial institution and should it be included in prudential consolidation

1. Should a company acting as a tied agent of the investment firm be included in prudential consolidation according to Art. 18 of CRR, if the tied agent is controlled by the same holding company as the investment firm (or by the investment firm itself)? 2. Should the company acting as a tied agent be included in the prudential consolidation a) because it is an ancillary services undertaking in accordance with Art. 4(1) point 18 of CRR, b) because it is a financial institution in accordance with Art. 4 (1) point 26 of CRR, or c) because of some other justification to require the consolidation, or d) should it not be consolidated at all in accordance with Art. 18(1) nor (8) of CRR.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2016_2875
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Clarification is sought on the treatment of defined benefit pension funds for the purposes of determining market risk RWA

Article 41(1) or Regulation (EU) No 575/2013 (CRR) and EBA Q&A 2014_1567 clarify that with respect to credit risk RWA, only the assets according to Article 41(1)(b), i.e. the assets for which the institution has an unrestricted ability to use and that have been use to reduce the CET1 deduction amount, must be captured for credit risk RWA purposes. We would like to reconfirm that the same treatment applies for market risk RWA, e.g. with respect to FX risk.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2016_2841
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

CRD Art. 140(4) in conjuction with CRR Art. 327 and CRR Art. 112

For the purpose of reporting as per point 3.4.3.2 of Annex 2 (Annex 2 of EC Implementing Act on Reporting) page 109 ''Own funds requirements for relevant credit exposures, trading book exposures and securitisation exposures in accordance with Article 140(4) CRD and determined in accordance with Part Three, Title II and Title IV of the CRR'' , are the referred CRR Art 112 restrictions under CRD Art 140(4) applicable also to IRB and also specifically for the purpose of point (b) Art 140(4) do the restrictions of CRR Art. 112 apply considering CRR Art. 327?

  • Legal act: Directive 2013/36/EU (CRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Draft ITS on Supervisory Reporting of Institutions (for benchmarking the internal approaches)
  • ID: 2016_2594
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Deductions of holdings of own funds instruments issued by financial sector entities included in the scope of consolidated supervision under art 49.2 CRR

For what specific purposes competent authorities may determine deductions of holdings of own funds instruments issued by financial sector entities included in the scope of consolidated supervision, apart from purposes mentioned in art 49.2: i.e. structural separation of banking activities and resolution planning? Should competent authorities determine deductions for all institutions in the member state or should it be more institution specific decision? In case of institution specific decision, should it be subject to joint decision, taken by the competent authorities of the home and host Member States?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_908
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Confirmation of waiver in particular situations

Is it confirmed that the waiver of the provisions in respect of deduction applies to capital instruments or subordinated loans that an entity holds or has granted temporarily for the purposes of a financial assistance operation designed to reorganize and save another entity even prior to the CRR/CRDIV regulations coming into force? Is it confirmed that the waiver of the provisions in respect of deduction for capital instruments or subordinated loans envisaged for the purposes of a financial assistance operation designed to reorganize and save the entity still applies also with reference to holdings already acquired but still necessary for the purposes of the financial assistance operation?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_875
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Grandfathering of Tier 1 instruments w.r.t. Dividend Stoppers and Pushers

When considering the eligibility into Tier 2 for grandfathered Tier 1 instruments - lets use an example where a T1 bond (step or non-step) has a recurring call date only once every 5 years (therefore, from an original maturity perspective it should be eligible for Tier 2 capital as a 5 year bond) Does your comment re. dividend pusher/stopper language restrict the ability of such a bond (assuming it has a dividend pusher/stopper) exclude it from Tier 2 eligibility? If Yes, why are these being treated differently from regular Tier 2 instruments (which do not have dividend pushers/stoppers) that have must pay coupons i.e. an obligation to pay a coupon, which if not paid constitutes a default and thus has stronger implications than on stopping coupons on a T1 bond as mentioned above

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_537
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Non material losses

The definition of what is a non-material loss is not defined within Article 472 of Regulation (EU) No 575/2013 (CRR); is it possible to clarify what ‘material’ / 'non-material' is? Can you advise how- if applicable- such non-material losses are treated?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_448
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

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

Treatment of subordinated loans in respect of Art 133 (3) CRR

Could you please confirm that subordinated loans according to Art 62.a CRR, which are acknowledged as Tier 2 are not regarded as equity exposures according to Art. 133.3 CRR.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_1384
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Groups including investment firm(s) referred to in Article 95(1) and investment firm(s) referred to in Article 96(1) and not including credit institutions.

What method of calculating the own funds requirement should be used when a group consists of both 95(1) and 96(1) investments firm and no credit institutions?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_1414
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Definition of the term „applicable amount“ with regard to the determination of the deductions from common Equity Tier 1 items of holdings by the institution of instruments of financial sector entities where the institution has a significant investment in those entities in Article 36(1)(i)) CRR

What is the relevant definition of the „applicable amount” in Article 36(1)(i) of Regulation (EU) No 575/2013 (CRR) with regard to the determination of the deductions of holdings by the institution of the Common Equity Tier 1 instruments of financial sector entities where the institution has a significant investment in those entities and for those entities the institution used the equity method under Regulation (EC) No 1606/2002 on a consolidated basis?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_1568
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Application of different Phase-In Rates for the Deduction of Deferred Tax Assets that Rely on Future Profitability

Article 478(2) of the CRR provides a discretion to competent authorities to apply a slower phase-in rate for the Deduction of Deferred Tax Assets that rely on Future Profitability for DTAs that existed prior to 1 January 2014. A 10% per annum phase in rate is applied for the DTAs that existed prior to 1 January 2014 while all other DTAs that were created post 1 January 2014 are subject to the normal phase in rates of 20% per annum. Clarification is required on how the different phase-in rates should be applied if the amount of DTAs (that rely on Future Profitability) in existence reduces below the initial amount recognised, due not to progressive deduction under the transition rules but rather due to usage against profit ? For example: Assume on 31 December 2014, the DTA balance is 100 which is made up of 60 that existed pre 1 January 2014 and 40 that existed post 1 January 2014. Assume that on 31 March 2015, the DTA balance reduces to 80 due to usage against profits. Should the DTA balance that existed pre 1 January 2014 be adjusted by the negative balances due to the DTA usage against profits i.e. should the slower phase-in rates be applied to the balance of 40?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 241/2014 - RTS for Own Funds requirements for institutions
  • ID: 2015_1963
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Allocations to the funds for general banking risk

Can banks allocate items to their funds for general banking risk without waiting for the annual accounts? If yes, is Art. 26 (2) CRR applicable for allocations during the financial year?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2019_4453
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Own funds

Article 63 j) of CRR states that "the instruments or subordinated loans, as applicable, may be called, redeemed or repurchased or repaid early only where the conditions laid down in Article 77 are met, and not before five years after the date of issuance or raising, as applicable, except where the conditions laid down in Article 78(4) are met". If an institution has a right of early redemption (not connected to the conditions laid down in Article 78(4)) which is effective five years after issuance but which has to be notified at least two years before redemption, is the instrument eligible as Tier 2 Capital ?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2018_4416
  • Topic: Own funds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022