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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

Exposure of the borrower to ESG factors

Does the assessment of exposure and mitigating techniques in the referenced articles apply to the impact of the borrower on ESG factors, or to the impact of ESG factors on the borrower? 

  • Legal act: Directive 2013/36/EU (CRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: EBA/GL/2020/06 - Guidelines on loan origination and monitoring
  • ID: 2022_6606
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 21/04/2023

Exposure Value in repurchase transaction

Under the accounting framework (IFRS) a repurchase transaction is accounted for as an off balance sheet commitment (encumbrance) for the debt securities given (or 'sold') and a liability for the debt towards the counterparty (representing the future 'repurchase' of the debt securities). With regards to such a transaction we have the following three questions, to confirm that our understanding is correct: A/ Is it correct that for the repurchase operation the final exposure value is to be calculated using the following elements:      E = the (dirty) market value of the debt securities given      C = the (dirty) cash borrowed in respect of the repurchase operation B/ Is this final exposure value E* to be presented as an counterparty credit risk on balance sheet exposure? C/ Does the debt securities itself also still have to be included as seperate exposures (with their respective risk weighted assets) (or does the calculated exposure value for the repurchase operation replace the direct exposure on the debt securities)?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6605
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 21/12/2022

PRUVAL - Matching Total fair values liabilities with FINREP

Should the validation Rule v6566_s check the sign of row 0150 (1.2 TOTAL FAIR-VALUED LIABILITIES) of template C 32.01?

  • 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 (repealed)
  • ID: 2022_6581
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 28/10/2022

SA-CCR cap margin agreement

How do you calculate the cap for netting sets subject to a contractual margin agreement mentioned in Article 274(3) CRR?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6571
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 04/11/2022

Recognition of plots of land as real estate collateral

There are plots of land that are owned by individuals or businesses that have been purchased for future use without (e.g. dowry, future residential building for own use, commercial exploitation, etc) but without any current indication of what its use will be. It is a form of investment without any current indication of its exploitation. These plots of land are usually in the form of additional collateral for personal loans or business loans. Can these be recognised as commercial real estate collateral under article 126 if all minimum requirements are satisfied?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6566
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 21/12/2022

When to apply CCF to residential mortgage off balance sheet exposure

For off balance sheet exposures, when Article 125(2)(d) references 'the part of the loan' that is less than or greater than 80% of the property value, does this refer to exposure, or gross loan balances. Therefore, should the required CCF be applied before or after comparing the balance commitment to the property value?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6563
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 30/11/2022

Article 111 or about

What CCF and provisions should be allocated, if any, in year 1/2/3/4 considering this special situation that I cannot find in the regulation?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: EBA/GL/2019/01 - Guidelines on specification of types of exposures to be associated with high risk under Article 128(3) of CRR
  • ID: 2022_6519
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 28/10/2022

Specialised Lending - Interpretation of contractual arrangements that give the lender a substantial degree of control

How shall Article147 (8)(b) CRR be interpreted when identifying ‘contractual arrangements that give the lender a substantial degree of control over the assets and the income that they generate’ in the context of real estate financing?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6501
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 07/09/2022

Credit risk and EBA Clearing instant payment system RT1

  Credit institutions are participating in EBA Clearing instant payment system RT1. Whether the bank’s credit risk exposure related to the system holding balance is to the system operator, ie EBA Clearing or to the European Central Bank as the institution managing the consolidated accounts?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6475
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 28/10/2022

Treatment of credit risk exposure for credit institutions accessing the overnight deposit facility via a national central bank

Should a credit institution accessing the overnight deposit facility via a national central bank (NCB) treat its credit exposure as being to the relevant NCB pursuant to Capital Requirements Regulation (CRR) Article 114(4), or to the European Central Bank (ECB) pursuant to CRR Article 114(3)?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6467
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 22/12/2022

Preferential risk weight for exposures to central governments and central banks under Article 114(4) of CRR

Does Article 114(4) of CRR apply to both on-balance sheet and off-balance sheet liabilities (including the forward leg of an FX swap) in the same domestic currency and at least the same amount as the exposure to the central government or central bank (on- or off- balance sheet exposures)?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6439
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 11/11/2022

Original maturity of credit lines until further notice

For risk classification as off-balance sheet item according to Annex I CRR, is the original maturity longer than one year where non-retail credit lines until further notice (i.e. no fixed maturity) may be cancelled with 3 months advance notification period and even immediately in case the borrower becoming delinquent or declaring bankruptcy?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6432
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 22/12/2022

Allocating exposures into the correct vintage buckets of the „NPL-backstop“ acc. to Art. 47c CRR applying Art. 469a CRR

For exposures classified as non-performing prior to 26 April 2019 and not exempt from the deductions from CET1 items for non-performing exposures acc. to Art. 36 (1)(m) applying the second subparagraph of Art. 469a CRR, which date should be considered when allocating those exposures into the vintage buckets of the “NPL-backstop” in COREP template C 35.01 to C 35.03 in order to determine the applicable amount of insufficient coverage for non-performing exposures acc. Art. 36 (1)(m) in conjunction with Art. 47c CRR: Is it the date on which the exposures were originally classified as non- performing, as it is with purchased non-performing exposures (see EBA ITS regarding C 35.01 c0010 - c0100) – in the example above a date prior to 26 April 2019? Or is it the date on which the criteria of the second subparagraph Art. 469a CRR (terms and conditions of the exposure - originated prior to 26 April 2019 - were modified by the institution in a way that increases the institution’s exposure to the obligor) were fulfilled and therefore the exposure shall be considered as having been originated on the date when the modification applies?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6425
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 22/03/2024

Scope of Article 118 CRR - World Food Programme

Can the  Risk Weight of 0%  according to Article 118 CRR be applied on  the World Food Programme (“WFP”)?   According to Article 118(f) CRR exposures to an international financial institution established by two or more Member States which has the purpose to mobilise funding and provide financial assistance to the benefit of its members that are experiencing or threatened by severe financing problems, shall be assigned a risk weight of 0%. Can WFP be classified as an international financial institution in the meaning of Article 118 (f) CRR ? 

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6414
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 20/06/2022

Risk weight for asset class of non-preferred senior debt

What risk weight should be applied to non-preferred senior (NPS) debt, under the standardised approach for credit risk? 

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6394
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 20/06/2022

SACCR - MPOR for derivatives between a clearing member and a CCP

Which is the MPOR that should be considered for derivatives between a clearing member and a CCP?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6382
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 26/07/2022

Calculation of loss given default for fully off-balance exposures in case there are no additional drawings after the default date.

According to point 55 of Article 4(1) of Regulations (EU) No 575/2013 (CRR) ‘Loss given default’ or ‘LGD’ means the ratio of the loss on an exposure due to the default of a counterparty to the amount outstanding at default.   In case the exposure is fully-off balance at the moment of default and there are no additional drawings after default, both the numerator and the denominator of the LGD will be equal to zero. This means that the LGD cannot be calculate using the definition stated above. Should the realized LGD be set equal to zero in this case? 

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6376
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 04/09/2023

Calculation of amount outstanding at default and loss given default for products in scope of Article 166 (10) of Regulations (EU) No 575/2013 (CRR)

Article 181(1)(a) of Regulations (EU) No 575/2013 (CRR) specifies that LGDs shall be estimated on the basis of the average realized LGD by facility grade or pool using all observed defaults. According to point 55 of Article 4(1) of Regulations (EU) No 575/2013 (CRR) ‘Loss given default’ or ‘LGD’ means the ratio of the loss on an exposure due to the default of a counterparty to the amount outstanding at default.   For the purpose of calculating the realized LGD, how should the amount outstanding at default (and the denominator of LGD) be calculated for exposures in scope of Article 166 (10) of Regulations (EU) No 575/2013 (CRR) that are fully off-balance at the moment of default?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6375
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 04/09/2023

Definition of private equity exposures in articles 155(2) and 155(3)

Do “private equity exposures in sufficiently diversified portfolios” eligible to a Risk Weight (RW) of 190% in simple risk weight approach in Article 155(2) and a PD of 65% in the PD/LGD approach in article 155(3) refer to any non-listed equity instrument and/or shares in a CIU or units in a CIU for which the underlying exposures are non-listed equity instruments, provided that they are part of a sufficiently diversified portfolio?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6369
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 11/11/2022