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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.

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List of Q&A's

Use of short-term issuer credit assessments with Article 131

May short-term issuer ratings be used to assign risk weights in the context of article 131?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2019_4941
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Prudential backstop (Regulation 2019/630) and interaction with RWA calculation

Is the prudential backstop deficit under Article 151(1) taken into consideration for the calculation of risk-weighted assets on exposures treated under the advanced IRB approach?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2019_4938
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

SCA for contactless payments at a POS executed via a mobile device

1) Can we consider the strong customer authentication (SCA) outsourced from the issuer of cards to the payer? 2) Is it necessary for the issuer of the cards to perform SCA based on the elements of identification that are beyond its control?

  • Legal act: Directive 2015/2366/EU (PSD2)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) 2018/389 - RTS on strong customer authentication and secure communication
  • ID: 2019_4937
  • Topic: Strong customer authentication and common and secure communication (incl. access)
  • Date of submission:
  • Published as final Q&A: 25/09/2020

Residential Reverse mortgages RWA

Could you clarify the regulatory RWA treatment for residential reverse mortgages exposure? Are those exposures subject to the standardised approach for RWA calculation?Is the regulatory treatment linked to the level of loan to value (LTV) the same as residential mortgages?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2019_4934
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 11/02/2022

IFRS 9 transitional arrangements – calculation of the static component in case of afterwards permission for the IRB approach

If an institution gets the permission to use the IRB approach only after 1 January 2018 or the date of initial application of IFRS 9, as applicable, how should the institution calculate the amounts for the transitional arrangements permitted by Article 473a CRR and, in particular, the static component according to paragraph 2 of Article 473a CRR for those IRB exposures to which the standardised approach applied on the 31 December 2017 or the day before the date of initial application of IFRS 9, as applicable?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2019_4928
  • Topic: Accounting and auditing
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Classification of credit insurance undertakings as financial institution

Will a credit insurance undertaking whose principal activity is to issue guarantees (as listed in Annex 1 of Directive 2013/36/EC) be deemed to be a "financial institution"?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2019_4926
  • Topic: Other topics
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

C 32.02 - Prudent Valuation: Core approach (PRUVAL 2); column 0160 (IPV Difference) and C 32.03 - Prudent Valuation: Model Risk AVA (PRUVAL 3); column 0110 (IPV Difference Output Testing)) and C 32.04 - Prudent Valuation: Concentrated Positions AVA (PRUVAL 4); column 0100 (IPV Difference)

What sign convention is expected for “IPV Difference” amounts in templates C32.02 (column 0160), C32.03 (column 0110) and C32.04 (column 0100)? Should validation rule v6341_m ({r0020} <= {r0010}, i.e. o/w Trading Book <= Total Core Approach) be modified to evaluate the absolute values in the equation?

  • 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: 2019_4924
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 30/04/2021

C 32.02 - Prudent Valuation: Core approach (PRUVAL 2); column 0260 (DAY1 P&L) and C 32.03 - Prudent Valuation: Model Risk AVA (PRUVAL 3); column 150 (DAY1 P&L)

What sign convention is expected for “Day 1 P&L” amounts in templates C32.02 (column 0260) and C32.03 (column 150)?

  • 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: 2019_4923
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 30/04/2021

Safeguarding requirements

Are transactions where both the payer and the payee are outside the EEA (e.g. a transfer between China and Hong Kong) outside the scope of the safeguarding requirements or not?

  • Legal act: Directive 2015/2366/EU (PSD2)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2019_4921
  • Topic: Other topics
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Inclusion (or not) of a particular "timing loss" in the C 16.00 and C 17.00 template

Shall a particular "timing loss" in the Operational Risk Losses be included or not in the reporting template for operational risk?

  • 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: 2019_4920
  • Topic: Operational risk
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Interpretation of payment instrument

What devices or procedures can be considered as payment instrument as per Art. 4(14) of PSD2.

  • Legal act: Directive 2015/2366/EU (PSD2)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2019_4919
  • Topic: Other topics
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Leverage Ratio treatment of intragroup exposures

Can an institution that uses the IRB approach for determining the risk weights for its exposures within the risk based framework apply for the exemption embedded in Article 429(7) CRR - as amended by Regulation 2015/62 - for the relevant intragroup exposures which are risk weighted under the IRB approach?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Delegated Regulation (EU) 2015/62 - DR with regard to the leverage ratio
  • ID: 2019_4917
  • Topic: Leverage ratio
  • Date of submission:
  • Published as final Q&A: 07/05/2021

Application of Articles 473a(3) and 473a(4) CRR (Practical application of Article 473a to exposures for which the approach to calculate RWAs changes after the day of initial application of IFRS 9

If an institution, for purposes of calculating credit risk RWAs, is migrating to the Standardised approach as of the reporting date, and formerly was under the IRB approach on the date of initial application of IFRS 9: :- should exposures relating to the reporting date (described under Article 473a(3)(a)) be included in the calculation concerning exposures which are subject to the Standardised approach (i.e. shall exposures included be those subject to the Standardised approach on that date)?- Should exposures relating to the date of initial application of IFRS 9 (described under Article 473a(3)(b)) be included in the calculation concerning exposures which are subject to the IRB approach (i.e. shall exposures included be those subject to the IRB approach on that date)?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2019_4916
  • Topic: Accounting and auditing
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

CCP related transactions

Do bilateral exposures vis-à-vis a clearing member qualify as trade exposures, and therefore fall under the exemption of Article 400(1)(j)?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2019_4915
  • Topic: Large exposures
  • Date of submission:
  • Published as final Q&A: 07/05/2021

Authentication code

Is an extra strong customer authentication (SCA) required, after logging in (with or without SCA) in the mobile application, to initiate the provisioning step to add the customers card to a third party wallet (e.g. Apple or Google pay)?

  • Legal act: Directive 2015/2366/EU (PSD2)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) 2018/389 - RTS on strong customer authentication and secure communication
  • ID: 2019_4910
  • Topic: Strong customer authentication and common and secure communication (incl. access)
  • Date of submission:
  • Published as final Q&A: 25/09/2020

Appropriate Risk Weight for purchased defaulted assets

Does the entering into force of the Regulation (EU) 2019/630 of the European Parliament and of the Council of 17 April 2019 (the “Prudential Backstop Regulation”) affect the determination of which risk weight that should be applied according to Article 127 CRR when an entity subject to CRR purchases non-performing loans booked at purchase price (net book value, “NBV”), which is significantly below the loans’ gross book value (“GBV”)?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2019_4909
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Definition of 'carrying amount’ for the purposes of templates C60.00 and C61.00

In the guidance annexes of DPM 2.8 for C 60.00 and C 61.00 templates the reporting amount has been further specified as ‘carrying amount’ however the breakdown of the template requires the amounts to be broken down according to the actual expected payments which suggests Cashflow. The Cashflow and the Carrying value can differ significantly due to changes in market value or impairments in the case of assets. For reporting purposes of the two above mentioned reports is it expected to split the carrying value across the time buckets based on when the cashflows are expected to be paid/received or to report the carrying value according to the residual maturity of the contract?

  • 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: 2019_4908
  • Topic: Supervisory reporting - Liquidity (LCR, NSFR, AMM)
  • Date of submission:
  • Published as final Q&A: 11/09/2020

Discrepencies between the "instructions" and the Data Point Model for the Maturity Ladder C66.01 COREP report

We have noted some discrepencies between the information we can find in the instructions and in the DPM. For instance, for the row 090 "1.2.1.1.1 Level 1 central bank ", the instructions for the COREP ALMM Maturity Ladder report C66.01 stipulate "The amount of cash outflows reported in item 1.2.1.1 which is collateralised by assets representing claims on or guaranteed by central banks. ", while in the sheet C66.01.a of the "Annotated Table Layout 281-COREP 2.8.1.1-Errata.xlsx" file it is specified that the central bank test must be done on the "counterparty sector" of the transaction, rather than on the "counterparty sector" of the collateral. An other example is the row 020 "1.1.1 Unsecured Bonds Due", for which the instructions do not require explicitely to exclude hybrid debt, while in the sheet C66.01.a of the "Annotated Table Layout 281-COREP 2.8.1.1-Errata.xlsx" file it is specified that the "Main Category" is "Debt securities issued. Other than Hybrid contracts". The general question is the following: when there is a discrepency between the instructions and what we can find in the DPM, is it correct to assume that the instructions do contain the correct requireement ? If not, what are the correct requirements for the above two cases?

  • 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: 2019_4907
  • Topic: Supervisory reporting - Liquidity (LCR, NSFR, AMM)
  • Date of submission:
  • Published as final Q&A: 11/09/2020

Interaction between total MREL and subordinated “eight percent TLOF” requirement

Article 45b(4) requires, for GSIIs and top tier banks, that “a part of” the total MREL requirement “equal to” eight percent of total liabilities, including own funds (TLOF), subject to possible upwards or downwards adjustments, is to be met with own funds and subordinated instruments (hereafter referred as “the subordination requirement”). How does this subordination requirement and its calibration interact with the methodology set out in Article 45c for determining the total MREL requirement? If the requirement resulting from the application of the methodology set out in Article 45c happens to be lower than 8% TLOF, subject to possible upwards or downwards adjustments, is that subordination requirement capped by the total MREL requirement?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2019_4906
  • Topic: MREL
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022