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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

Reporting of Off Balance Sheet Activities (Table 22.2)

If the reporting entity has the same assets under asset management and also under its custody, can the assets reported in sub-sections of table 22.2 (e.g. ‘Custody assets’, ‘Asset Management’, and ‘Central administrative services for collective investment’) be duplicated?

  • 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Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)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_312
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 07/03/2014

Reporting currency - Table 40.1

Which reporting currency should be used in table 40.1 Group Structure 'entity-by-entity'? Shall the reporting currency of the each investee (consolidated entities) or the investor (parent) be used?

  • 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Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)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_311
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 07/03/2014

Prudential Consolidation of Financial Institutions

'Financial Institution' means an undertaking other than an institution, the principle activity of which is to acquire holdings or to pursue one or more of the activities listed in points 2 to 12 and point 15 of Annex 1 to Directive 2013/36/EU, including a financial holding company, a mixed financial holding company, a payment institution within the meaning of Directive 2007/64/EC of the European Parliament and of the Council of 13 November 2007 on payment services in the internal market (1), and an asset management company, but excluding insurance holding companies and mixed-activity insurance holding companies as defined in point (g) of Article 212(1) of Directive 2009/138/E. The definition in Article 4(1)(26) Regulation 575/2013 is in line with the definition of financial institution under Article 4(5) of Directive 2006/48/EC in that it encompasses firms whose principle activity is to acquire holdings or to perform the activities under Annex 1 of Directive 2013/36/EU. The EU had issued guidance on its Your Question on Legislation ('YQOL') site that indicated that, for Article 4(5) of 2006/48/EC it was correct to consider holding companies as financial institutions. We understand that t his has been interpreted differently by different regulators in the EU, in particular, where a bank owns shares in a holding company that owns a non-financial group (i.e. a group that does not undertake an Annex 1 activity), certain regulators have taken the view that the holding company as a legal entity should be consolidated for regulatory capital purposes whilst the non-financial subsidiaries are deconsolidated. However, other regulators have considered the nature of the activities of the group (holding company plus non-financial subsidiaries) and determined that the holding company need not be consolidated. Could the EBA please clarify which interpretation is correct?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_310
  • Topic: Other issues
  • Date of submission:
  • Published as final Q&A: 15/11/2013

Reporting SME-supporting factor as an 'of which' of SMEs

Within the COREP templates, the SME supporting factor (Article 501) is shown as a subset of the SMEs (general). This is reinforced by the validation rules within the DPM. Given SME(general) has a <250 person criteria and the SME-supporting factor doesn't how is this reported?

  • 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_309
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 21/03/2014

20% inflow on assets with an undefined contractual end date

What is the practical interpretation of 20% inflow on assets with an undefined contractual end date?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_306
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 21/02/2014

Outflows on other liabilities for Operational Accounts (Basel para 93 -104)

a. CRR in addition to clearing, custody and cash management CRR considers “other comparable services” eligible for a 5% run off. Are correspondent banking and prime brokerage services included in the definition? b. How does one prove that the client is unable to withdraw without compromising client’s operational functioning over a 30 day horizon? c. How often do you need to check if an account is meeting the criteria for operational accounts?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_305
  • Topic: Liquidity risk
  • Date of submission:

Reporting of collateral swaps

We do not understand how collateral swaps should be integrated in the reporting template. o Indeed, to calculate the inflows / outflows concerning reverse repos and repos, there should theoretically be a cap on the difference between the cash value of the operation and the market value of underlying security. To calculate the inflows / outflows generated by collateral swaps, the same kind of calculation should be done, but without the cap. o Since operationally the same cells should be used to integrate repos / reverse repos and collateral swaps in the EBA template, we do not understand how this can give adequate results in terms of LCR ratio calculation.

  • 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_303
  • Topic: Supervisory reporting - Liquidity (LCR, NSFR, AMM)
  • Date of submission:
  • Published as final Q&A: 22/08/2014

Treatment of cash collateral

What is the treatment in LCR and NSFR of cash collateral given or received in derivative transactions?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_302
  • Topic: Liquidity risk
  • Date of submission:

Definition of a "material penalty" and "individually justified circumstances"

What is the definition of a "material penalty" and "individually justified circumstances"? Who will be the final arbiter in determining the “materiality” of the penalty for early withdrawal within 30 days?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_301
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 24/10/2014

Member States government bonds

Can the EBA confirm that all Member States government bonds are defined as liquid assets and not excluded if their credit quality is low e.g. would Greek government debt be eligible currently? It is our understanding where you have foreign currency liabilities they can be matched with sovereign bonds in that currency. But in the EU are all Euro sovereign bonds equally eligible as liquid assets or do they need to fulfil also the eligibility criteria in Art 416 (1) (b)?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_294
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 08/01/2016

Minimum reserve requirement

What is the requirement to maintain the minimum reserve requirement within the LCR period, i.e. does the LCR have to be met for each of the 30 days in the stress horizon?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_293
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 04/07/2014

CIUs

Where an institution consists of a parent bank and two subsidiaries does the EUR 500 million cap on CIUs apply to consolidated group or can it apply to each of the legal entities? In the latter case this would imply the consolidated group could count up to EUR 1500 million CIU.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_292
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 23/10/2015

Repurchase and cancellation of Tier 2 in the open market less than 5 years from issue

Can you please confirm if Article 78(4) is meant to apply only to the redemption of T2 securities within 5 years of issuance (as specified in the terms and conditions of the instrument), or if it also prohibits the use of liability management exercises to repurchase (and cancellation) T2 notes at market levels within 5 years of the issuance.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_290
  • Topic: Own funds
  • Date of submission:

Definition of threshold

Definition of threshold. Should bonds be considered in the calculation of the 1mln/€ threshold?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_289
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 02/10/2015

Definition of retail deposits.

Can the EBA confirm that retail bonds (both retail and small business) can be treated as retail deposits?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_288
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 23/10/2015

Reporting frequency for template C17.00 Op risk details

Please elaborate which reporting period that should be included in the semi-annual reporting of template C017.00. According to the Annex II, part 4.2 paragraph 119 this template summarises the information by an institution in the last year. If it should be reported with a semi-annual report, which reporting period should then be included in the reporting as per end Dec resp. end June? Possible way to read this: - The same figures should be reported twice a year (just as template C16.00 contains the same figure for four quarters in row). - Rolling 12 month reporting (i.e. as per end June is 1/7 the previous year until 30/6 the reporting year)

  • 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_285
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 14/02/2014

Assets controlled by a liquidity management function

Would only those assets which are directly controlled by the liquidity management function fall within the definition of liquid asset holdings (subject to meeting the other conditions) under Regulation (EU) No 575/2013 (CRR), or do those assets which are not directly controlled by the liquidity management function also qualify?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_280
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 24/01/2014

Treatment of repos and reverse repos collateralised by commodities

The current guidance for Section 1.6 of the reporting template, Monies due from secured lending and capital market driven transactions as defined in Article 192, contains the following statement: 'Therefore, any transaction in which the institution has provided a collateralised loan in cash, such as reverse repurchase transactions as defined in Article 4(59) of Regulation (EU) No 575/2013, expiring within 30 days, shall be reported in this section'. The ITS guidance states that this section relates to rows 120-930, however we not believe that these rows contain categories that cover the treatment of repos and reverse repos collateralised by commodities stocks such as aluminium, nickel, carbon credits etc. Clarification is therefore needed on the reporting of such transactions.

  • 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_277
  • Topic: Supervisory reporting - Liquidity (LCR, NSFR, AMM)
  • Date of submission:
  • Published as final Q&A: 30/04/2014

Reporting of repos and reverse repos with underlying liquid asset collateral

Clarification on the reporting of repos and reverse repos with underlying collateral which is eligible for inclusion in the liquid asset buffer is needed. In particular, CRR Article 416 allows for unencumbered assets obtained through reverse repo transactions to be included within the pool of liquid assets and greater clarity is needed therefore on how these should be reported on C51.00 and C53.00.

  • 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_274
  • Topic: Supervisory reporting - Liquidity (LCR, NSFR, AMM)
  • Date of submission:
  • Published as final Q&A: 28/03/2014

Value adjustments for prudent valuation (Additional Value Adjustments)

Article 34 of Regulation (EU) No. 575/2013 (CRR) requires institutions to apply a deduction from CET1 the amount of any additional value adjustments on all assets measured at fair value calculated in accordance with Article 105. Article 105(14) of the CRR specifies that the EBA shall submit draft regulatory technical standards to the Commission by 28 July 2013 (as per CRR corrigendum published on 2 August 2013). In this regard the EBA published a draft consultation paper (EBA/CP/2013/28) whereby it is specified that "as a consequence of the EBA decision to conduct a QIS, the EBA currently envisages to finalise the technical standard in Q2 2014". Therefore it is not clear as concerns the first reporting date on Q12014 whether institutions must: 1) not apply the prudential filter (i.e. the relative reporting item shall be valued zero) until the publication of the final EBA RTS 2) calculate the prudential filter in accordance with the Basel II framework (i.e. requirements for prudent valuation defined by each local regulator) 3) calculate the prudential filter in accordance with the draft EBA standards as defined in consultation paper EBA/CP/2013/28

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_273
  • Topic: Market risk
  • Date of submission: