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List of Q&A's

FINREP Template F 16.07 - Accumulated Impairment

Validation rule v3956_s requires all values presented in column 040 (Accumulated impairment) of template F 16.07 to be negative. The row labels on rows 060 and 100 state “Impairment or (-) reversal of impairment”. As a result, column 040, presented negative, appears to only allow the disclosure of accumulated net reversals of impairments. Please could we receive clarification that this validation is correct?

  • 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Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)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_2143
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

FINREP Templates F 01.02 and F 43.00

The closing balance of pending legal issues and tax litigation provisions is presented on both row 210 of template F 01.02 and column 040 of template F 43.00. However the guidance reference differs between the two templates. Please confirm which set of guidance should be followed?

  • 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Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)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_2140
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

FINREP Template 19 - column 050 - of which: Performing forborne exposures under probation

Due to the amended wording, it is unclear, whether only performing forborne exposures under probation which have been reclassified out of the non-performing forborne exposures category shall be reported in column 050 or all performing forborne exposures under probation which have been reclassified out of non-performing category at any time in the past. Regarding the two examples given below, the question is if both exposures have to be reported in column 050 of template F 19.00 or only exposure A? Exposure A was classified as non-performing with forbearance measure and fulfilled all required exit criteria mentioned in paragraph 157. Thus, exposure A was reclassified out of the non-performing forborne exposures category and has to be reported in column 050 as long as it does not fulfil the exit criteria of paragraph 176. Exposure B was classified as non-performing 2 years ago, no forbearance measure was granted. One year ago, exposure B fulfilled all exit criteria of paragraph 156 and was reclassified as performing. Six month ago, on exposure B an forbearance measure was applied which has not led the exposure to be classified as non-performing. Does exposure B have to be reported in column 050 of template F 19.00 due to the fact it was reclassified out of the non-performing category (without forbearance measure) one year ago?

  • 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_2056
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

Reporting on "collateral received" and "financial guarantees received" in columns 170 and 180 of template F 19.00

Should be included in columns 170 and 180 of template F 19.00 also collateral received on performing exposures with forbearance measures?

  • 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_1880
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

Definition of "Refinancing" for the purpose of reporting in columns 040, 080 and 160 of template F 19.00

What is the appropriate definition of "Refinancing" for the purpose of reporting in columns 040, 080 and 160 of template F 19.00?

  • 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_1879
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

F 12.00 - changes of counterparty sector

In FINREP template F 12.00 movements in allowances for credit losses in the current year are reported taking into account the credit loss assessment method and the relevant counterparty sector. It is possible that the counterparty sector changes within the reporting time frame (i.e. from the date of the opening balance in column 010 to the reporting date, that is the date of closing balance in column 070). If this is the case, does the reporting institution take into account the counterparty sector as at the reporting date? Or are such changes reported in column 060 Other adjustments?

  • 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_1844
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

FORBORNE PERFORMING/CLASSIFICAZIONE CLIENTE - FORBORNE PERFORMING / CLIENT CLASSIFICATION

Since the concession of more favourable conditions as part of commercial practice is not comparable to a forbearance measure, if, during the probation period, the client (forborne performing), once their situation has returned to normality after largely overcoming potential ‘difficulties’, were to request an adjustment of the conditions in line with other competing banks, if the bank met the request for obvious reasons of expediency, would it then be forced to reclassify the client?Posto che la concessione di condizioni più favorevoli, rientranti nella prassi commerciale, non è equiparabile ad una misura di forberance, se nel periodo probatorio il cliente (forborne performing), tornato in condizioni di piena regolarità avendo ampiamente superato potenziali “difficoltà”, richiedesse un adeguamento delle condizioni rispetto ad altre banche concorrenti, a fronte della adesione della banca alla richiesta per evidenti ragioni di opportunità, la stessa si vedrebbe quindi costretta a ri-classificare il cliente?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Draft ITS on Supervisory Reporting of Institutions
  • ID: 2015_1841
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

Treatment of ‘short-term’ exposures - Trattamento delle esposizioni a “breve termine"

With regard to short-term exposures involving renegotiations triggered by financial difficulties of the debtor – hence forborne – we ask that the deadline after which the anomalies and subsequent modifications in use must be considered for forborne purposes (past due invoices not paid by a certain date, tied-up amounts, time given for covering outstanding claims, etc.) be established objectively beforehand.Con riferimento alle esposizioni a breve termine in presenza di rinegoziazioni dovute a difficoltà finanziarie del debitore e dunque forborne si chiede di stabilire in modo oggettivo e predeterminato la tempistica oltre la quale le anomalie e le successive modifiche di utilizzo devono essere considerate ai fini forborne (fatture scadute e non rimborsate oltre una certa data, importi immobilizzati, tempi per la copertura degli insoluti ecc.).

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Draft ITS on Supervisory Reporting of Institutions
  • ID: 2015_1839
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

Forbearance of Non-performing Exposures

A clarification regarding the scope of application for forbearance of Non-performing Exposures is required.

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Draft ITS on Supervisory Reporting of Institutions
  • ID: 2015_1838
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

Reporting of overdue factoring contracts

In the case of trade finance (factoring) contract with multiple accounts receivable (corresponding multiple debtors) of which only single one is past due, should the carrying amount be reported (in the table F 07.00 Financial assets subject to impairment that are past due or impaired) at the single debtor (single account receivable) level that is actually past due or general contract level? Should it be differently reported in the case of factoring contract with the recourse right and without the recourse right?

  • 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_1804
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

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

Inconsistencies in FINREP validation rules F01.01 versus F04.03

According to F01.01 row 260 should be specified in table F04 (and F40). However, the validation rules v3390_i, v3394_i, v3398_i, do not permit this: v3390_i : {F 01.01, r070 , c010}=={F 04.01, r010 , c010} v3394_i : {F 01.01, r110 , c010}=={F 04.02, r010 , c010} v3398_i : {F 01.01, r150 , c010}=={F 04.03, r010 , c030} How should investments in Venture capital companies which are classified as Associated companies be reported?

  • 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: 2014_1666
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

FINREP template 9.2

In FINREP template F 9.2 (Other Commitments Received) what is the nature of the Commitments to include in this section? Does non-mandatory commitments as per example promissory notes received or confort letters should be considered as part of this section?

  • 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: 2014_1661
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

FINREP template F 18.00 Information on performing and non-performing exposures – applicable approaches

According to point 154 of FINREP instructions (Annex V) when exposures are assessed as non-performing two approaches (“transaction” and “debtor” approach) can be applied. In addition point 155 of Annex V specifies a threshold (20%), which shall be taken into account. 1. Shall the threshold laid down in point 155 be applicable uniformly for retail and non-retail (for example corporate) debtors? a) No. The method laid down in point 155 considers all of the debtor’s exposures as non-performing if its exposures past due by more than 90 days represent at least 20% of its all on-balance sheet exposures. In our understanding this method is stricter than the “transaction approach” (e.g. in the case of retail debtors), but it is less stricter than the “debtor approach” (e.g. in corporate exposures). According to the “debtor approach”, when a debtor has an exposure past due by more than X days, all of the exposures to this debtor shall be considered and reported as past due by more than X days regardless that its past due exposures represents less or more than 20% of all its exposures. Therefore the method laid down in point 155 is less stricter than the debtor approach and so it doesn’t have any significance in the case of those debtors which shall be assessed as NPE according to the “debtor approach” in accordance with Article 178 of CRR (for example corporate exposures). It has significance only in the case of the “transaction approach”. OR b) Yes. The 20% threshold is applicable uniformly for all debtors (retail and non-retail debtors) and therefore only those debtors’ exposures should be considered as past due more than 90 days, whom past due exposures represent at least 20% of all their on-balance sheet exposures. In this case the 20% threshold laid down in point 155 is not an additional rule, it shall be applicable instead of the “debtor approach”. 2. How should the 20 % threshold be calculated? Does it mean that the gross carrying amount of only the past due (> 90 days) parts of the credit facilities or the gross carrying amount of the whole individual credit facilities that have any amounts past due by more than 90 days represents at least 20% of the total on-balance sheet exposures to a debtor? 3. According to point 155 the 20% threshold shall be considered only when the exposure is past due by more than 90 days. Does it mean the threshold shall not be taken into account in other past due categories? For example if a debtor has on-balance sheet exposures past due by more than 30 days the gross carrying amount of which represents 20% of the gross carrying amount of all its on-balance sheet exposures, this threshold shall not be applied and all of a debtor’s exposures shall not be reported in the “30 days < past due <= 60 days” category. Is our understanding right? 4. Point 155 says when a debtor has on-balance sheet exposures past due by more than 90 days the gross carrying amount of which represents 20% of the gross carrying amount of all its on-balance sheet exposures, all on- and off-balance sheet exposures to this debtor shall be considered as non-performing. But it doesn’t say that all exposures to this debtor shall be considered as past due by more than 90 days. Taking also into account the provisions of point 158 and 159, does this threshold work as a kind of debtor approach and pulls together all of the debtor’s exposures into one category? For example the debtor has an on-balance sheet exposure past due by more than 90 days, another exposure past due by more than 180 days and another that is not past due, but its past due exposures represent more than 20% of all its on-balance sheet exposures. In this case should all its exposures be reported in column 090 (Past due > 180 days <= 1 year) or should the exposures be reported separately according to their number of days past due in column 070, 080 and 090?

  • 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: 2014_925
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

Mortgages as the real estate collateral received to be included in template AE-COL

Following the answer provided on Q&A 2013_675 we would like to clarify if mortgages as the real estate collateral received should be included in template AE-COL. If so, in which column / row should it be reported.

  • 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_2217
  • Topic: Supervisory reporting - Asset Encumbrance
  • Date of submission:
  • Published as final Q&A: 13/12/2019

Cash collateral posted in the Asset Encumbrance return F32.01

Where should cash collateral posted be treated in the Asset Encumbrance return F32.01?

  • 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: 2017_3530
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 13/12/2019

Asset Encumbrance - Eligible collateral in a central bank

Should deposits at central banks be reported as central bank eligible assets?

  • 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: 2017_3619
  • Topic: Supervisory reporting - Asset Encumbrance
  • Date of submission:
  • Published as final Q&A: 13/12/2019

Wrong validation rule v2855_m

Is a netting of repurchase agreements with securities lending needed in Asset Encumbrance?

  • 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_2190
  • Topic: Supervisory reporting - Asset Encumbrance
  • Date of submission:
  • Published as final Q&A: 13/12/2019

CRR's definition of an investment firm

Article 4(1)(2)(c) CRR contains three conditions for an investment firm, as defined by MiFiD I, to be excluded from the CRR definition of an investment firm. What is the difference between the first and the third condition set in this article?Under what circumstances can you have an investment firm that is permitted to hold money or securities belonging to its clients that has not been authorised to provide safekeeping and administration of financial instruments for the account of its clients?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2018_3663
  • Topic: Other topics
  • Date of submission:
  • Published as final Q&A: 13/12/2019

Compliance with SCA in offline mode on an aircraft without internet connection

How can Strong Customer Authentication (SCA) be applied in an offline environment onboard an airplane when chip and pin cannot be verified with a Point of Sale (POS) device? Specifically, how is dynamic linking achieved in an offline mode for airlines who don't have internet connectivity but instead have a closed wireless network to be able to make purchases onboard an aircraft?

  • 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_4740
  • Topic: Strong customer authentication and common and secure communication (incl. access)
  • Date of submission:
  • Published as final Q&A: 06/12/2019