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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

Asset transfer in case of sale of business tool

What is the proper basis of transferring assets in case of sale of business tools as referred to in Article 38(1) of Directive 2014/59/EU (BRRD), is it the resolution authority decision or agreement?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1778
  • Topic: Resolution tools and powers
  • Date of submission:
  • Published as final Q&A: 06/02/2015

Solvency in the context of Article 32(4)(d)

What is a solvent institution in the context of Article 32(4)(d) of Directive 2014/59/EU(BRRD)?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1777
  • Topic: Resolution objectives and triggers
  • Date of submission:
  • Published as final Q&A: 17/04/2015

Credit Risk Mitigation

Can an institution legally "ring fence" cash it has to mitigate an exposure to a counterparty (using it as financial collateral)? The institution does not wish to notify the counterparty. The CRR is not clear on whether financial collateral used to mitigate an exposure must come from the counterparty or not.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1776
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 10/07/2015

Non transferred assets, rights and liabilities of shareholders or creditors

Articles 38(13), 40(11) and 42(12) of Directive 2014/59/EU (BRRD) state that shareholders or creditors whose assets, rights and liabilities are not transferred, shall have no rights over the assets, rights and liabilities that are transferred. What is meant by that and how would this affect a creditors right in rem against an institution?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1775
  • Topic: Resolution safeguards
  • Date of submission:
  • Published as final Q&A: 30/01/2015

Use of an existing legal person as a bridge Institution

In cases where a legal person already exists can this be used for the purposes of Article 40 of Directive 2014/59/EU (BRRD)? Does, in particular, Article 40(2)(b) of the BRRD exclude using a) a legal person that already exists but is now bought for this purpose; b) using a legal person that is being held available for this purpose by the institution concerned?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1774
  • Topic: Resolution tools and powers
  • Date of submission:
  • Published as final Q&A: 30/01/2015

Timing of Valuation

Should the valuation according to Article 36(1) of Directive 2014/59/EU (BRRD) be carried out 1) only at the very beginning of the whole process, i.e. before the first application of the resolution tool or the power to write down or convert capital instruments or 2) in the cases where two or more tools or powers are applied should the valuation be carried out before each of them?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1773
  • Topic: Valuation
  • Date of submission:
  • Published as final Q&A: 30/01/2015

Bridge Insitution Tool

Can you please clarify whether Article 41 (4) of Directive 2014/59/EU (BRRD) is about the sale by the resolution authority of the bridge institution; or the sale by the bridge institution of the institution in resolution or an entity referred to in Article 1(1)(b)(c)(d)?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1772
  • Topic: Resolution tools and powers
  • Date of submission:
  • Published as final Q&A: 30/01/2015

Appointment of Temporary Administrator

Does Article 29 of Directive 2014/59/EU (BRRD) mean that a competent authority can appoint a temporary administrator to replace the senior management as well as the management body?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1771
  • Topic: Early intervention
  • Date of submission:
  • Published as final Q&A: 30/01/2015

Bail-in tool

Can the list of exemption from bail-in of Article 44(2)(g)(i) of Directive 2014/59/EU (BRRD) be interpreted such as to include a) continued payment of wages in case of illness; b) holiday pay; c) compensation for a worker who was unable to exercise his right to paid annual leave on account of incapacity for work?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1770
  • Topic: Resolution tools and powers
  • Date of submission:
  • Published as final Q&A: 30/01/2015

Actions of a Special Manager

Is the scope of actions of a special manager mentioned in Article 35(3) of Directive 2014/59/EU (BRRD) an exhaustive list

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1769
  • Topic: Special management
  • Date of submission:
  • Published as final Q&A: 30/01/2015

Covered bonds issued by non-EEA member states

In the context of two identical covered bonds, the first issued by a French bank and qualifying for covered bond status, and the second issued by a Canadian bank identical in all other respects, can the latter one be treated as a covered bond under the third country equivalence decision or can covered bonds only be issued by credit institutions having their registered office located in a Member State?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1767
  • Topic: Securitisation and Covered Bonds
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Treatment of Sovereign Wealth Funds as non-financial customers or financial customers

If an institution has unsecured deposits from a Sovereign Wealth Fund, are those deposits from financial customers or deposits from non-financial customers?

  • 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: 2015_1764
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 30/04/2015

Group Solvency - Combined Buffer Requirements

Annex II, Part 2, section 2.4, column 410 (combined buffer requirement) refers to CRD article 128.The format of C 06.01 / C 06.02 suggests that column 410 includes column 440 (Conservation Buffer due to Macro-Prudential or Systemic Risk Identified at the Level of a Member State) given that the heading for column 410 embraces column 440.However Article 128 CRD states:'combined buffer requirement' means the total Common Equity Tier 1 capital required to meet the requirement for the capital conservation buffer extended by the following, as applicable:(a) an institution-specific countercyclical capital buffer;(b) a G-SII buffer;(c) an O-SII buffer;(d) a systemic risk buffer;This does not include column 440 of C 06.01 / C 06.02, which is set through Article 458 CRR.Clarification is hence sought as to whether    (A) 410 = 420 + 430 + 450 + 460.or (B) 410 = 420 + 430 + 440 + 450 + 460

  • 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: 2015_1759
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 28/07/2017

FINREP Counterparty Breakdown (ESA 2010)

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'.

  • 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: 2015_1758
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 15/04/2016

Definition for short-term letters of credit

What does short-term in this context mean? 90 days or 1 year? Residual maturity or original effective maturity?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1757
  • Topic: Other issues
  • Date of submission:
  • Published as final Q&A: 19/06/2015

Reporting of "Value according to Article 418 of CRR" of liquid assets

How should the "Value according to Article 418 of CRR" be calculated for assets which do/do not fulfill the requirements of Article 416 and/or Article 417 CRR (C 51.00 Reporting IDs 2 - 4, C 52.00 Reporting IDs 1.2.2.11 - 1.2.2.13, C 53.00 Reporting IDs 1.6.11 - 1.6.13 - without IDs 1.6.13.13 - 1.6.13.13.3)

  • 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: 2015_1752
  • Topic: Supervisory reporting - Liquidity (LCR, NSFR, AMM)
  • Date of submission:
  • Published as final Q&A: 05/03/2021

Validation rules v1026_m to v1029_m and v1372_m to v1376_m.

According to IAS 24.19 " The disclosures shall be made separately for each of the categories" - in ex. subparagraph a "Parent and entities with joint control or significant influence" it is not mentioned that individuals in subparagraph f "Key management personnel of the entity or its parent "and/or g "Other related parties" shall be eliminated. The case is that subparagraph a to e deals with organisationunits while f and g deals with individuals, and there is not mentioned any kind of exclusion between the categories. The problem is that the validationrules assume the opposite ex. v1375_m: sum({F 31.02, r040, (c010-050)}) <= {F 02.00, r200,c010}

  • 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: 2015_1749
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

Application of volatility haircuts adjusted under Article 285(3) (extended margin period of risk)

Is the ‘use test’ set out in Article 225(3)(a)/(b) of the CRR intended to be sufficiently strong to invoke the use of haircuts adjusted under Art 285(3) in the non-model exposure calculation for a netting set containing a single SFT?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1748
  • Topic: Market risk
  • Date of submission:
  • Published as final Q&A: 19/06/2015

Calculation and reporting of own funds requirement for Market risk: Foreign exchange risk

According to article 351 of CRR the own funds requirement for foreign exchange risk shall be the sum of its overall net foreign-exchange position and its net gold position in the reporting currency, multiplied by 8 % while in article 352 (4) of CRR the net foreign exchange position is calculated as follow: “ Net short and long positions in each currency other than the reporting currency and the net long or short position in gold shall be converted at spot rates into the reporting currency. They shall then be summed separately to form the total of the net short positions and the total of the net long positions respectively. The higher of these two totals shall be the institution's overall net foreign-exchange position.” It seems that according to article 351 the institution should calculate two different Positions subject to capital charge: the first one for exposures in foreign exchange currencies and the second one for gold and calculate as a consequence two different own fund requirement - according to Eba template design. While according to calculation described in article 352 it seems that the institution should calculate only one Position subject to capital charge that considers foreign exchange currencies and gold too; as a consequence in order to fill in the EBA templates that requires all information splitted in different rows, the institution should provide a breakdown of the total value previously calculated according to a proportion. In this case how should the institution calculate this proportion? According to this different approaches it is possible to obtain two different results (in terms of total own fund requirement), here below an example: Article 351: Net long positions Net short positions MAX – position subject to capital charge Foreign exchange currencies 70 50 70 Gold 60 60 Total 130 Article 352 (4): Net long positions Net short positions MAX – position subject to capital charge Foreign exchange currencies 70 50 Gold 60 Total 70 110 110 According to the first approach the institution will obtain a higher Position subject capital charge. Which approach shall we use?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1745
  • Topic: Market risk
  • Date of submission:
  • Published as Rejected Q&A: 11/02/2022

Securities borrowing - early termination clause vs HQLA

In case securities borrowing contract has a clause for early termination how shall we consider the notification period vs cash outflow for the calculation of LCR? Ex: 2 days notification period for early termination of securities borrowing contract. a) Do you consider this clause as a restriction to liquidation? b) Unless the early termination clause is activated can we omit the securities borrowed from cash outflows within 30 days?

  • 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: 2015_1743
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 19/06/2015