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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

Off-balance sheet items and definition of default

Please confirm that indeed the off-balance sheet part of a facility (e.g. undrawn amount) or any other off-balance sheet items e.g. acceptances, guarantees, etc should not be categorised in the "in default" exposure class even if the customer is classified as "in default".

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_239
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 06/12/2013

IRB Approach

Regarding the IRB approach for the calculation of capital requirements for preventing credit risk, where should the weighting formula be applied? Is it contract by contract, or is it a weighted average of the probability of default (PD) and loss given default (LGD) for each pool and then apply the risk weight formula to this mean?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_144
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 29/11/2013

SA - Retail Classification - EUR1 million limit

In the definition of the retail exposures it states "...excluding exposures fully and completely secured on residential property collateral that have been assigned to the exposure class laid down in point (i) of Article 112..." of Regulation (EU) No. 575/2013 (CRR). Does this mean that exposures that are in default but fully secured on residential property (meeting all minimum requirements and limits) are not excluded?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_72
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 29/11/2013

Artikel 115 (3) Zuordnung von Religiongemeinschaften zu Forderungsklasse/ Attribution of religious communities to an exposure class

Was ist mit der Aussage im 3. Satz gemeint: In diesem Fall gilt Absatz 2 nicht..." ? English translation: What does the statement ‘In this case, paragraph 2 shall not apply…’ in Article 115(3) mean?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_327
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 08/11/2013

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

Capital charge for credit derivatives in the banking book in the position of protection seller

In Regulation (EU) No 575/2013 (CRR) we assume that for credit derivatives in the banking book in the position of protection seller the present capital charge is calculated only for credit risk with respect to the underlying and no extra capital charge for counterparty credit risk after CRR is needed. Do you agree?

  • 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_387
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 08/11/2013

Immovable property risk weights under the standardised approach (commercial)

Is the 50% standardised risk weight applicable to exposures fully and completely secured by mortgages on commercial property outside the Union?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_66
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 31/10/2013

Immovable property risk weights under the standardised approach (residential)

Is the 35% standardised risk weight applicable to exposures fully and completely secured by mortgages on residential property outside the Union?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_65
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 31/10/2013

Applicable risk weights for agricultural properties.

Should exposures fully secured by agricultural properties be assigned a risk weight of 100% according to article 124 or can they be considered as residential or commercial properties according to article 125 and 126 and, thus, have a lower risk weight?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_94
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 27/08/2013

Credit risk mitigation techniques - independent, written and reasoned legal opinions

Must lending institutions always obtain a written reasoned legal opinion in order to rely on their credit protection techniques for the purposes of Article 194(1) of the CRR? If so : a) must such opinion be obtained from external legal counsel? b) must such opinion be specific to the relevant transaction and techniques in respect of which the institution seeks to rely upon such opinion, or can lending institutions rely on generic opinions for particular types of transactions? If the latter, how often should the generic opinions be updated?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_23
  • Topic: Credit risk
  • Date of submission:

Definición de PYME - SME definition

¿Qué criterios debe reunir una empresa para considerarse que es "PyME"? Translation to EN: SMEs - What are the defining criteria?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_27
  • Topic: Credit risk
  • Date of submission:

Definition of default in terms of days

Is it correct that the 180 day definition is only available for other purposes linked to the referenced defaulted loans under the standardised approach – but not for the 100% risk weight? Could this represent a discrimination of SA banks against IRB banks which might be allowed to apply a 180 day definition for the risk weight of defaulted residential/SME commercial/public sector loans under their internal rating systems?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_58
  • Topic: Credit risk
  • Date of submission: