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List of Q&A's

Validation rules of templates F 24.01 and F 24.02 specifically EGDQ_0665, EGDG_0666, XBRL v8035_m and XBRL v8052_m. These validations impose that the closing figures of the prior financial year end should tally with the opening figures of the current reporting quarter without allowing for reclassifications or changes of the counterparties’ reporting criteria segregated in F 24.01 and F 24.02, namely collateral type, and SME criteria.

For accounts which do not have a change in non-performing status, how are changes in collateral and/or SME status of the counterparty are to be reported in F 24.01 and F 24.02, since validation rules of templates F 24.01 and F 24.02, specifically EGDQ_0665, EGDG_0666, XBRL v8035_m and XBRL v8052_m, cannot all be complied with simultaneously when such changes occur after the previous financial year end?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) 2021/451 – ITS on supervisory reporting of institutions
  • ID: 2024_7070
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as Rejected Q&A: 31/05/2024

Scope of application of recital 54 of MICAR

Question 1: Recital 54 MiCAR seems to presume that the same ART may be issued by EU and third country entity, when speaking of "Issuers of asset-referenced tokens that are marketed both in the Union and in third countries". Does recital 54 mean a technically same fungible token not (externally) attributable to a particular issuer or does this only mean that the token has the same rights attached and is marketed under the same name but is not technically identical and should be attributable to one issuer (in Union or in third countries)? Question 2: Does Recital 54 MiCAR, while referring to ART issuers and their reserve of assets requirements, also apply to EMT issuers (including cases where no reserve requirements under MiCAR apply) and should it be used to interpret prudential requirements for EMT issuers (including Article 54 MiCAR and EMD)? Question 3: if ever recital 54 was to be extended to all EMT issuers, how would this recital have to be interpreted in relation with article 54, which foresees that EMT issuers should safeguard funds received by issuers of e-money tokens in exchange for e-money tokens in accordance with Article 7(1) of Directive 2009/110/EC? 

  • Legal act: Regulation (EU) No 2023/1114 (MiCAR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2024_7069
  • Topic: Other MiCAR topics
  • Date of submission:

One leg out Multi EMT issuance – legal possibility and related issues

Question 1: Can a technically identical and fully fungible EMT based on a non EU currency be issued by, on one hand, a EU-based entity licensed as an electronic money institution or credit institution (therefore complying with MICAR) and, on the other hand, by an entity based in another non EU jurisdiction and non regulated under EU law?  Question 2: If ever the preceding arrangement was possible under MICAR, then would it be compliant with Article 48(1) MiCAR in case a person on the EU territory was to offer or seek admission to trading on EU markets for tokens issued by the entity not authorised as an electronic money institution or credit institution?  Question 3: [This question is to be read in light of associated QA on scope of recital 54] If ever the preceding arrangement was possible under MICAR, given that this technically identical and fully fungible EMT would freely circulate on the secondary market and would actually be marketed both in the EU and in non EU jurisdictions, should competent authorities apply to this arrangement provisions set by recital 54?  Question 4: [This question is to be read in light of associated QA on scope of recital 54] If ever the preceding arrangement was possible under MICAR and recital 54 could be applied, then would competent authorities have to apply safeguarding requirements for the EU licensed entity based on the volume of tokens this entity issued (as per MICAR article 54) or on the “issuers’ liability towards Union holders”, based on “the share of […] tokens that is expected to be marketed in the Union” (as per MICAR recital 54)? Question 5: In order to mitigate potential regulatory arbitrage and capital flight in the context of a one leg out multi EMT issuance, would it be compliant with MICAR to allow only EU-based residents to present redemption requests to the EU-based entity

  • Legal act: Regulation (EU) No 2023/1114 (MiCAR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2024_7068
  • Topic: Other MiCAR topics
  • Date of submission:

Powers of MiCAR authority to obtain the information needed to assess recovery and redemption plans and possible mechanism for exchange of information with the prudential authority

In cases where the MiCAR authority differs from the prudential authority under CRD, respectively the competent authority for recovery plans under BRRD, does the Regulation ensure that the MiCAR authority is provided with the powers to gather from the supervised entities (in the course of the ongoing supervision) all information that is necessary in order to duly assess the recovery and redemption plans of banks and investment firms? If there is a risk of insufficiency of information at the disposal of the MiCAR authority, what will be the mechanisms ensuring proper access of information by the MiCAR authority to the information available within the prudential authority on the financial indicators and other key metrics for the purposes of assessment of the recovery and redemption plans, as well as whether Member States are expected to implement special measures to ensure the protection of sensitive information? How the flow of information towards the CRD competent authority from the MICAR supervisors should be assured in order for CRD authority to be able to perform on their tasks? 

  • Legal act: Regulation (EU) No 2023/1114 (MiCAR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2024_7067
  • Topic: Recovery plans (MiCAR)
  • Date of submission:

Liabilities related to the reserve of assets managed by issuers of asset-referenced tokens in case of resolution of the issuer

Please clarify whether liabilities related to the reserve of assets under Article 36 (2) MiCAR have to be treated as secured liabilities and therefore cannot be subject to write-down and conversion or bail-in in case of resolution in the meaning of the BRRD.

  • Legal act: Regulation (EU) No 2023/1114 (MiCAR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2024_7066
  • Topic: Other MiCAR topics
  • Date of submission:

Provision of external payroll accounting services to an employer

Does the activity of external payroll processing for an employer constitute a payment service under PSD2, if it consists of receiving funds for wages and related deductions (taxes, health and social insurance) in the payroll processor’s payment account from the employer, and transferring these to employees, tax authorities, insurance companies etc.? Would the answer change depending on whether the payroll processor  maintains an account separately for each employer?   

  • Legal act: Directive 2015/2366/EU (PSD2)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2024_7065
  • Topic: Authorisation and registration
  • Date of submission:

Unrated short term claim/exposure

As per CRR Article 120(para 3, subpara c), it states: "If there is a short-term assessment and such an assessment determines a less favourable risk weight than the use of the general preferential treatment for short-term exposures, as specified in paragraph 2, then the general preferential treatment for short-term exposures shall not be used and all unrated short-term claims shall be assigned the same risk weight as that applied by the specific short-term assessment." Question: 1. Is the term claim and exposure used interchangeably and mean the same?                   2. What is meant by unrated short term claim in this paragraph? If there is a general issuer rating available for the counterparty, but no issue specific rating for the exposure to the counterparty, will the exposures with residual maturity of less than 3 months be classed as Unrated and not eligible for preferential risk weight treatment as per CRR Article 120 (2)?                   3. Also, for ex- if the bank has trading book exposure to this institution for exposure less than 3 months. But this institution has issued short term debt, but the bank has no exposure to it, in that case which rating will be used to risk weight the exposure in the trading book. Will it be the issuer rating or short term debt rating the institution has issued which the bank has no exposure?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Draft ITS on Supervisory Reporting of Institutions
  • ID: 2024_7064
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 15/06/2024

Template 2 – Total gross carrying amount reported in column A

Should column a be equal to sum (columns b to g + o)*(1- column p) as per XBRL validation rule?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) 2022/2453 - ITS on ESG disclosures
  • ID: 2024_7063
  • Topic: Transparency and Pillar 3
  • Date of submission:
  • Published as Rejected Q&A: 28/06/2024

Template 5 – Total gross carrying amount reported in column B

Which gross carrying amount should be reported in column b? Should it be the total of the exposures by sector as reported in Template 1 or should it be the total of columns c to f?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) 2022/2453 - ITS on ESG disclosures
  • ID: 2024_7062
  • Topic: Transparency and Pillar 3
  • Date of submission:
  • Published as Rejected Q&A: 28/06/2024

Definition of 'explicit guarantee arrangements' for the purpose of classification of non-commercial undertakings as public sector entities

What conditions should be met by a given agreement in order to qualify as an 'explicit guarantee arrangement'? Shall the ‘explicit guarantee arrangements’ for the purpose of definition of public sector entities also be ‘guarantees’ eligible as unfunded credit protection or not? How much should the guarantee cover?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2024_7061
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 15/06/2024

Fair-valued assets and liabilities excluded because of partial impact on CET1 – Prudential Filters

Template C32.01 Prudent valuation. Fair-Valued assets and liabilities requires the Prudential filters Fair-valued assets and liabilities excluded because of partial impact on CET1 (col 0050) to be reported in accordance with Article 4(2) of Delegated Regulation (EU) 2016/101 due to the transitional application of the prudential filters referred to in Articles 467 and 468 of Regulation (EU) No 575/2013. Since Articles 467 and 468 of Regulation (EU) No 575/2013 are related to COVID transitional fix items, should the institution report 0 in this column until the guidance is updated?   Additionally, validation v6566 related to this template, states that values reported for Fair-valued assets and liabilities excluded because of partial impact on CET1 – Prudential Filters (c0050) have to be equal to or higher than 0. Could you please confirm if this validation is applicable in all the contra liability balances?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2024_7059
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 04/07/2024

Level of application of permissions for consolidated netting

How should the term 'consolidated basis' be read in Article 325b CRR? Should permissions in accordance with that article be granted only to the highest EU consolidating entity or is it possible to grant these permissions also to several EU sub-consolidating entities? If it is possible to apply this requirement also on a sub-consolidated basis, should the offsetting of the positions only refer to undertakings included in such an entity’s sub-consolidated group?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2024_7058
  • Topic: Market risk
  • Date of submission:
  • Published as final Q&A: 21/06/2024

Credit

Does this credit qualify as consumer credit, exclusively available to individual consumers? Or can it also be extended to legal entities?

  • Legal act: Directive 2015/2366/EU (PSD2)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2024_7056
  • Topic: Other topics
  • Date of submission:

LCR treatment of a committed facility provided to multiple borrowers

What is the LCR treatment of a committed credit facility provided to multiple borrowers where:each individual borrower might draw the full (undrawn) amount of the committed credit facility;all borrowers belong to the same overarching group which, from group perspective, would qualify as a non-financial corporate; whileone or more of the individual borrowers might qualify as a financial customer under Article 411(1) CRR on a stand-alone basis.

  • 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: 2024_7055
  • Topic: Liquidity risk
  • Date of submission:
  • Published as Rejected Q&A: 31/07/2024

Capital requirements and Investment policy - Articles 47 and 46 of CSDR

Taking into account the applicable legal provisions of Article 46(4) and 47(1) of CSDR and RTS (EU) 2017/390 and the need to ensure a reasonable level playing field between banking and non-banking CSDs, how should the provision of the RTS on Prudential Requirements for CSDs (RTS (EU) 2017/390) apply to the treatment of investments in tangible assets for non-banking CSDs that are not considered eligible to cover a CSD's capital requirements, and are therefore filtered out?

  • Legal act: Regulation (EU) No 909/2014 (CSDR) - only RTS 2017/390
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) 2017/390 - RTS on prudential requirements of CSDs (CSDR-related)
  • ID: 2024_7054
  • Topic: Market infrastructures
  • Date of submission:

LCR treatment of open maturity reverse repos which can be terminated at any point in time

By reference to EBA Q&A 2021_6163, are there some circumstances under which a bank could consider inflows from open reverse repos that  are not contingent for the purposes of its recognition in the LCR? 

  • 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: 2024_7053
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 03/05/2024

Interest flows

Interest flows for retail on sight accounts (without contractual maturity)

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2024_7052
  • Topic: Liquidity risk
  • Date of submission:

Duplicate ICT Incident Reporting

Is duplicate incident reporting via the ECB SSM Cyber Incident Reporting Framework required, alongside DORA incident reporting under Article 19?

  • Legal act: Regulation (EU) No 2022/2554 (DORA)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2024_7050
  • Topic: ICT-related incidents (management / classification / reporting)
  • Date of submission:

Alignment of the GAR Templates 7 and 8 with the templates used by the European Commission

According to the European Commission, in the COMMISSION DELEGATED REGULATION (EU) 2023/2486 of 27 June 2023, information on the six objectives must be reported. In addition, there are differences between the EC and Pillar 3 GAR templates, such as the absence of rows for financial corporations not subject to NFRD in Pillar 3, the presence of an "Of which adaptation" in column J, which is redundant as the objective in Pillar 3 is adaptation to climate change, and the presence of columns for the use of proceeds in the EC template, whereas the columns in Pillar 3 are for specialised lending. When will the Pillar 3 ESG reporting templates (6, 7, 8 and 9) be updated in line with those of the EC?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) 2022/2453 - ITS on ESG disclosures
  • ID: 2024_7049
  • Topic: Transparency and Pillar 3
  • Date of submission:
  • Published as Rejected Q&A: 28/06/2024

ESG P3 - Templates 9.1 and 9.2 Decision Tree KPI BTAR for Financial Corporations

According to the question 2023_6681, the Financial Corporation located outside European Union (EU) and Financial Corporation located in EU but not subject to NFRD disclosures exposures should be reported in the row 44 of the template 7 Other assets (e.g. Goodwill, commodities etc.). In which row/group of rows should be reported in the Template 9.1 - Mitigating actions: Assets for the calculation of BTAR and Template 9.2 - BTAR Since there are only specific rows for Non-Financial Corporation?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) 2022/2453 - ITS on ESG disclosures
  • ID: 2024_7048
  • Topic: Transparency and Pillar 3
  • Date of submission:
  • Published as Rejected Q&A: 28/06/2024