Question ID:
2015_1758
Legal Act:
Regulation (EU) No 575/2013 (CRR) as amended
Topic:
Supervisory reporting - FINREP (incl. FB&NPE)
Article:
99
COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations:
Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (as amended)
Article/Paragraph:
Annex V
Disclose name of institution / entity:
Yes
Name of institution / submitter:
Oesterreichische Nationalbank
Country of incorporation / residence:
Austria
Type of submitter:
Competent authority
Subject Matter:
FINREP Counterparty Breakdown (ESA 2010)
Question:

Annex V, Part 1, Reference 6.34 (b) 'general governments': Please confirm that public companies and private companies controlled by central governments, state or regional governments, local governments (including administrative bodies and non-commercial undertakings), that are market producer has to be reported in accordance with ESA 2010 (which may either lead to a classification as "non-financial corporation" or "financial corporation"). Annex V, Part 1, Reference 6.34 (d) 'other financial corporations': Please confirm that 'captive financial institutions' according to ESA 2010 has to be reported under 'other financial corporations'.

Background on the question:

As the FINREP counterparty breakdown strongly relies on the ESA-classification [e.g. see the reference in Annex V, Part 1, Reference 6.34 (e) of 'non-financial corporations' to the ECB BSI Regulation which itself refers to the ESA-Regulation] which has to be amended from ESA 1995 to ESA 2010 (applicable as from 31.12.2014), instructions in Annex V of the ITS should be amended accordingly.

Date of submission:
27/01/2015
Published as Final Q&A:
15/04/2016
EBA Answer:

The European system of national and regional accounts (ESA) is the system of national accounts and regional accounts, published by Eurostat and used by members of the European Union. It was most recently updated in 2010 and is enforceable by Regulation (EU) 549/2013 as from 1 September 2014.

The ESA has been used as a basis on which to report counterparty sector information in certain FINREP templates like F 04.01, F 04.02, F 04.03, F 04.04, F 04.06, F 04.07, F 04.08, F 04.09, F 04.10, F 05.00, F 07.00, F 08.01 F 09.01, F 09.02, F 10.00 F 11.01, F 11.02, F 12.00, F 13.01, F 16.01, F 18.00, F 19.00, F 20.04 and F 20.06 of Annex III and IV of Regulation (EU) No 680/2014 - ITS on Supervisory Reporting of institutions (ITS on reporting).  ESA 2010 has amended the criteria to be applied to determine whether a counterparty (referred to as an institutional unit in ESA) should be classified to the government sector.  Once a counterparty has been determined as to being government controlled a further "market test" is applied. 

If it is determined that the counterparty is a market producer, this will lead to it being classified as a non- financial corporation or a financial corporation under ESA 2010.

This is similarly addressed in EBA Q&A 2013_184, which discusses the specific case for hospitals, schools, social secretaries.

In addition, to further reflect ESA 2010, Captive financial institutions shall be reported under "other financial corporations".  

Status:
Final Q&A