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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

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

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

Standardised Approach for Counterparty Credit Risk (SA-CCR) exposure value for a netting set subject to a margin agreement

For the calculation of the SA-CCR EAD according to the CRR2, does one need to calculate the EAD according to the CRR2 Art 275, 278 (that results into an EAD of €41m in the example), or does one need to apply the BCBS CRE 52 guidance (that results into an EAD of €378m in the example)?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6354
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 26/07/2022

AVC

Is AVC intended to apply to Multilateral Development Banks?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2021_5715
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 20/06/2022

Treatment of guaranteed export financing transactions under Standardised Approach

Under the Standardised Approach for credit risk, can institutions apply a 0% risk weight to the guaranteed part of export financing transactions if (i) the loan is denominated and funded in the domestic currency of the central government acting as guarantor and (ii) the guarantee is also denominated in this currency while the domestic currency of the borrower is different?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2021_5760
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 20/06/2022

Credit faclity level

Is it possible to assign default according to the purpose of the loan (e.g only the exposure that was granted for renovation) and treat it as at facility level or not? In case of one agreement for 2 purposes and 2 amounts granted, from the regulatory perspective can we treat such approach as default assignment at facility level or not?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: EBA/GL/2016/07 - Guidelines on the application of the definition of default under Article 178 CRR
  • ID: 2020_5447
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 20/06/2022

SME supporting factor for exposures collateralised by residential property

How should the SME supporting factor be calculated for exposures to SME where the total amount owed to the institution is collateralised by residential property?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2020_5337
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 20/06/2022

Definition of the parameter E* in the formula regarding the Adjustment of risk-weighted non-defaulted SME exposures.

We believe there is a need of clarification in the definition of the parameter E* in the formula of the article 501 in order to insure that the result of the formula is valid in all cases.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2020_5223
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 20/06/2022

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

Own estimation of conversion factors for off-balance sheet exposures for binding mortgage/loan offers

Is the own estimation of credit conversion factors considered relevant for binding mortgage/loan offers, with a maturity of less than one year?. Should the total amount of a binding mortgage/loan offer be considered as "currently undrawn amount of a commitment that could be drawn" or not?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6368
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 20/06/2022

EBA/GL/2017/16 Interpretation

Conformity of the  implementation pursuant to Article 152 CRR to EBA/GL/2017/16

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: EBA/GL/2017/16 - Guidelines on PD estimation, LGD estimation and the treatment of defaulted exposures
  • ID: 2022_6361
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 20/06/2022

Documentation language - Do IRB documentation need to be in English?

Does IRB documentation need to be in English? Is there any official guideline on what documentation is acceptable in non-English language?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2022_6340
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 29/04/2022

Recording of necessary documentation in relation to the disbursement of the loan

In relation to  46 of the EBA Guidelines on loan origination and monitoring, what is expected in relation to the 'recording of necessary documentation in relation to the disbursement of the loan', specifically in relation to adherence to the institutions' obligations towards AML/CTF requirements?  

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: EBA/GL/2020/06 - Guidelines on loan origination and monitoring
  • ID: 2022_6329
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 29/04/2022

The use of the financial collateral comprehensive method for retail exposures

If an institution uses the combination of A-IRB and F-IRB approaches for its retail (A-IRB) and corporate exposures (FIRB), can this institution then only use the Financial Collateral Comprehensive Method (FCCM) for its corporate exposures? If yes, what should it do for its retail exposures secured by financial collateral?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2021_6279
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 29/04/2022

CRM for off balance sheet commitments

1) Can the part of the off-balance exposure that is covered by the (to be vested) mortgage inscription be taken into account as 'fully secured and completely secured by mortgage' under Article 125(1) CRR?    2) Can the part of the off-balance exposure that is covered by the (to be vested) mortgage guarantee be taken into account as credit risk mitigation under Article 203 CRR?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2021_6234
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 29/04/2022

Original Maturity for off balance sheet items

1) Are loan commitments that constitute (accepted or unaccepted) loan offers to clients to be considered off balance sheet items, which fall under the definition of 'undrawn credit facilities' of Annex 1?    2) The 'original maturity' that is used for the allocation of 'undrawn credit facilities' to either medium risk, or medium/low risk is determined on the basis of the maturity of the commitment or on the basis of the underlying loan of the offer?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2021_6233
  • Topic: Credit risk
  • Date of submission:
  • Published as Rejected Q&A: 29/04/2022