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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

Validation Rules: v0219_m, v0221_m

Both rules validate the Surplus(+) / Deficit(-) of certain capital:- v0219_m for CET1 Capital- v0221_m for T1 CapitalThe question stands: Should the range of percentages from Article 465 CRR be implemented in the validation rules for each type of capital or should the fixed percentages in Article 92 CRR be upheld?

  • 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Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)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: 2014_1093
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 14/10/2016

FINREP - F 09.02 Loan commitments, financial guarantees and other commitments received

FINREP Template F 09.02 - Financial guarantees received. In the position 'Financial guarantees received' items that meet the definition according to article 58 of Annex V of the ITS on Supervisory reporting should be reported. In this context, in case the bank has a surety contract, which is a legally binding agreement that the signee will accept responsibility for another individual's contractual obligations (usually the payment of the loan contractual obligations if the principal borrower falls behind or defaults), should it be reported in the position 'Financial guarantees received' or in the position 'Other Commitments received'? Also in case of several surety contracts related to one loan obligation that aren't prioritized and have equal legal force which allocation principles should be applied according to article 63 of Annex V of the ITS on Supervisory reporting.

  • 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Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)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: 2014_1065
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 14/10/2016

Material holdings and deferred tax below the deduction threshold

Under article 48 CRR, material holdings and deferred tax assets that are below the 10% / 17.65% CET1 thresholds should be risk weighted at 250% (thus increasing capital requirements rather than being deducted from capital resources). However, there is nowhere on template CA2 to report these items, so where should we report them in order to increase our capital requirements accordingly? CA4 asks for the thresholds to be reported but there is nothing on that template that applies the risk weights or increases requirements.

  • 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_670
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 14/10/2016

Deferred tax assets that rely on future profitability and that arise from temporary differences

According to art. 469(1c) CRR, the deferred tax assets that arise from temporary differences can be deducted in a transitional manner using the percentages specified in art. 478(2) CRR. The residual amount that is not deducted, is to be risk weighted at 0% (art. 472(5) CRR). Whereas for other regulatory deductions there is a specific row in template C 05.01 that is used to indicate the transitional amounts, it is not clear where in this template the transitional amounts for deferred tax assets that arise from temporary differences must be indicated. For row 380 is it specifically indicated that it holds the transitional arrangement referred to in art. 470 CRR, while rows 390-420 hold the transitional arrangements related to own funds instruments of financial sector entities where the institution has a significant investments. Row 170 only concerns deferred tax assets that rely on future profitability and do not arise from temporary differences.

  • 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_225
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 14/10/2016

Calculation of the threshold for applying the Simplified approach for Additional Valuation Adjustment (AVA).

We are interested in knowing:1. If for the calculation of the thresholds asset and Liabilities under the FVO regime have to be (proportionally) taken into account (indeed, EBA RTS does not explicitly include them within the list of valuation positions for which a proportional calculation of the threshold can be applied- see EBA RTS introduction notes, subsection 3; on the other hand the EBA RTS does not explicitly excluded them). According to our view the answer to this question is yes (art. 34 states that additional value adjustments - calculated according to article 105 - shall apply to all fair value positions and not only to the trading book).2. If the answer to question 1) is yes then we are interest in knowing how to calculate the part that should be taken into account (i.e. the part that is not deriving from the own credit spread movements; the part that has an impact on CET1); we would like to know the criterion that should be used in order to calculate the “proportional part” of these stocks (of asset or liabilities) that is impacting the CET 1.3. If the answer to question 1 is yes and if the bank hedges the “the interest rate component” (that has impacts on CET1 ratio) of the asset or liability at FVO we are interested in knowing if this component has to be taken into account in order to calculate the part of the Assets/Liabilities that is going to be considered for the thresholds calculation?4. Does the answer to question 3 changes if the interest rate component is hedged “back to back” (reference to Q&A n. 29) with external counterparties or only hedged with a “portfolio approach”? Moreover, it is correct to consider as “not back to back hedges” (then a situation in which still the interest rate movements determine some P&L and consequently CET 1 effects) the situation in which there is a hedge back to back with a subsidiary that manages the interest rate risk with “portfolio approach”?5. Which is the meaning of “exactly matching, offsetting positions (art. 105 (14) point 3” to be excluded in the calculation of Simplified Approach threshold? Does it mean only an asset position and the corresponding position took as a liability, that exactly match each other in term of security type and amount (e.g. € 1 mln long position in Google equity stock in the trading book portfolio and 1 € mln short position on Google stock) or the meaning refers also to perfect hedging strategy (e.g. long the stock, short the equity futures with delta =0)?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) 2016/101 - RTS for prudent valuation under Article 105(14) CRR
  • ID: 2015_1715
  • Topic: Market risk
  • Date of submission:
  • Published as final Q&A: 07/10/2016

Retail exposures above EUR 1m - definition and understanding

Would a private individual client need to be regarded as "non retail" if the original exposure is above EUR 1 million (line EUR 2m) or could he stay in the "Retail" exposures class if his EAD is below EUR 1million (EAD close to zero) or the drawn amount is below euro 1m (drawn amount below EUR1m)?Clarity would be appreciated for both the standardised and IRB approach.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2016_2626
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 07/10/2016

Use of financing arrangement for covering the gap between transferred assets and liabilities in case of application of the sale of business tool

In light of Article 101(1) of the BRRD, is the resolution authority authorised to use the financing arrangement to finance the gap between all the purchased assets and liabilities, by the means of a direct grant/subsidy, in the amount of the negative difference between the assets and liabilities under a condition that the contribution is compliant with the Union State aid framework?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2016_2591
  • Topic: Resolution financing arrangements
  • Date of submission:
  • Published as final Q&A: 30/09/2016

Definition of a 'Deposit Broker'

What is the definition of a deposit broker?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Delegated Regulation (EU) 2015/61 - DR with regard to liquidity coverage requirement
  • ID: 2016_2642
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 23/09/2016

Liquid assets valuation in case of hedging with collateralized derivatives.

Should the potential close-out of hedges of securities included within the liquidity buffer be taken into account when hedging is performed through collateralized derivatives?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Delegated Regulation (EU) 2015/61 - DR with regard to liquidity coverage requirement
  • ID: 2016_2695
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 23/09/2016

Treatment of decreases of impairments in the calculation of the exposure value

In the context of published Q&A 2014_1087 how should a credit institution treat decreases of impairments, value adjustments or provisions (in case of reduced identified losses) recognised during the year, i.e. in the interim period, in the case where the competent authority has not given its permission to include the interim profit into the calculation of Common Equity Tier 1 capital, and the credit institution has not reflected the amounts with a corresponding "immediate reduction in Common Equity Tier 1 capital" although the changes in impairments, value adjustments or provisions for off-balance sheet items are reflected in interim profits or year-end profits?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 183/2014 - RTS for the calculation of specific and general credit risk adjustments
  • ID: 2016_2629
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 23/09/2016

Exemption from cap of inflows per Article 33 (1) of the Commission Delegated Act 2015/61

(a) Can the national competent authority of a Member State grant such exemption where the inflow arises from the parent companies or subsidiaries incorporated in third countries?(b) If the reply to the first question is positive, shall the national competent authority carry out an assessment as required under the draft regulation to be issued by the ECB under Article 425(5) of the CRR and Article 34(1)(2) and (3) of the Commission Delegated Regulation (EU) 2015/61 or shall the national competent authority follow other national guidelines?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2016_2660
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 23/09/2016

Extending the range of application system.

What is practically meant by 'additional exposures related to the lending decision of a third party to the group'?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 529/2014 - RTS on materiality of extensions and changes in the advanced approaches (IRB and AMA)
  • ID: 2015_2224
  • Topic: Model validation
  • Date of submission:
  • Published as final Q&A: 23/09/2016

Reporting ICAAP requirements

Where does a firm report its ICAAP requirement if it has not undergone a SREP or been notified by its National Competent Authority that it must take additional own funds requirements

  • 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: 2014_1258
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 09/09/2016

Information on performing and non-performing exposures

Table F 18.00 of FINREP contains the breakdown by past-due time bands of performing and non-performing exposures. In case of "debtor approach" how should the exposures to a given debtor be allocated to columns? And do such criteria have to be applied to both performing and non-performing debtors?

  • 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: 2015_2192
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 09/09/2016

Reporting of template C017.00

According to ITS Annex II, Part 2, paragraph 119. C017.00 The template C017.00 summarises the information by an institution in the last year. According to EBA final Q&A 2013 285: The reporting of C 17.00 (OPR Details) shall be based on the calendar year. The figures reported in June of the respective year are interim figures, the final figures are reported in December. But it is still not clear whether data is expected on the relevant calendar year (as current year) or on the last calendar year (as previous year): 1) data as of June 30, 2015 is about gross losses relevant to last calendar Year 2014 (the whole year) or about gross losses relevant to current calendar Year 2015 (1. half-year)? 2) data as of December 31, 2015 is about gross losses relevant to last calendar Year 2014 or about gross losses relevant to current calendar Year 2015?

  • 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: 2014_1571
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 09/09/2016

Validation error in CA4 (v3688_s)

A validation in CA4 (v3688_s) prevents completion of rows 240, 270 and 291, therefore how should a short synthetic position be reported to offset a direct long position?

  • 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: 2014_1546
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 09/09/2016

Validation v1740_m

In FINREP template 8.1 "Breakdown of financial liabilities" (EBA/ITS/2014/05 as of 30/07/2014) hedge accounting derivatives are not included in validation v1740_m, although they qualify as financial liabilities in terms of IAS 39.

  • 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: 2014_1539
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 09/09/2016

Memorandum Items in Credit Risk SA

Can you please confirm that the memorandum items in row 290-320 only should 1. Include Exposures secured by immovable property under articles 124,125 and 126 2. In case of the exposure being to a "High Risk" customer that is fully secured by an eg. RRE then the in template C 07.00 - exposure class "High Risk" no memorandum items will be completed (based on point 54 of the instruction as High Risk Category is not one of them) BUT instead the original asset class of the high risk obligor eg. Corporate should be completed

  • 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: 2014_1295
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 09/09/2016

Annex I, C 05.01

I am a little confused by two validations with the ID of V2000_s and V2035_s. My understanding is that column 50 should be a percentage but validation rule (V2035_s) states that it must be >=0 and column 10 should be the absolute number but the validation rule (V2000_s) shows that this should be <=0.

  • 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: 2014_1261
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 09/09/2016

C 09.03 - Calculation of the breakdown of total own funds requirements for credit risk of relevant credit exposures by country (CR GB 3)

Suppose that a bank has an exposure an own funds requirements to country A of € 10,000 while the bank’s total exposures total own funds requirements (i.e. the aggregate exposure aggregated own funds requirements to all countries) is € 500,000. In addition, let’s say that the bank’s own funds is € 80,000. Would this mean that for the purposes of template C 09.03, under the sheet related to country A, the bank is required to report the amount of € 1,600 (i.e. (€ 10,000 / € 500,000) x € 80,000)?Is the method above correct to calculate total own funds requirement for credit risk of relevant credit exposures by country or are there any guidelines issued by the EBA or found in the CRR?

  • 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: 2014_1247
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 09/09/2016