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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

Entity that formally is not a part of public administration as resolution authority

Is it possible under Directive 2014/59/EU (BRRD), in particular under Article 3 to designate as a resolution authority, an entity that is entitled to issue administrative decisions but formally is not a part of public administration?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_2075
  • Topic: Other topics
  • Date of submission:
  • Published as final Q&A: 24/07/2015

Third country resolution proceedings

How do “Third country resolution proceedings” as defined in Article 2 (1) (88) affect a failing EU institution when these are applied to a failing third country parent?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_2072
  • Topic: Other topics
  • Date of submission:
  • Published as final Q&A: 24/07/2015

Definition of branches of institutions that are established outside the Union

How should “branches of institutions that are established outside the Union […]” in Article 1 (1) (e) be interpreted?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_2071
  • Topic: Other topics
  • Date of submission:
  • Published as final Q&A: 24/07/2015

Clarification to Recital 41

Do you agree that the word “not” is missing in Recital 41 and should be corrected? (“Resolution should be initiated when a competent authority, after consulting a resolution authority, determines that an institution is failing or likely to fail and alternative measures as specified in this Directive would not prevent such failure within a reasonable timeframe.”)

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_2069
  • Topic: Resolution objectives and triggers
  • Date of submission:
  • Published as final Q&A: 24/07/2015

Annual Contribution of institutions - determination of the risk weight / use of indicators

How to construct the specific indicators as referred to in Annex I of DA in cases where the required data / information was not included in the applicable supervisory reporting for a reference year, although equivalent data did?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Delegated Regulation (EU) 2015/63 - DR on ex ante contributions to resolution financing arrangements
  • ID: 2015_1927
  • Topic: Resolution financing arrangements
  • Date of submission:
  • Published as final Q&A: 24/07/2015

Annual Contribution of institutions - determination of the basis for annual contributions and the risk weight / use of CRDIV/CRR terminology

What information / data shal be used when determining the annual contributions to resolution financing arrangements in situations, where information required by specific indicators as referred to in Annex I and II of DA is not included in the applicable supervisory reporting for the reference year, e.g. due to inapplicability of the CRDIV/CRR?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Delegated Regulation (EU) 2015/63 - DR on ex ante contributions to resolution financing arrangements
  • ID: 2015_1926
  • Topic: Resolution financing arrangements
  • Date of submission:
  • Published as final Q&A: 24/07/2015

Exclusion of Intragroup Liabilities - General Rule

"Does the criterion of Article 5 (1) a) ii) of DA ""each institution is included in the same consolidated supervision according to Artices 6 to 17 of Regulation No 575/2013 (EU) on a full basis"" alows also intragroup liabilities between ""sister"" companies to be excluded while calculating individual ex ante contributions to resolution arrangements?"

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Delegated Regulation (EU) 2015/63 - DR on ex ante contributions to resolution financing arrangements
  • ID: 2015_1923
  • Topic: Resolution financing arrangements
  • Date of submission:
  • Published as final Q&A: 24/07/2015

Basis for ex-ante contributions to resolution financing arrangements

What does Article 103(2) of BRRD mean by the requirement to ”exclude own funds” from the liabilities of institutions when determining the ex-ante contribution to resolution financing arrangements?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1921
  • Topic: Resolution financing arrangements
  • Date of submission:
  • Published as final Q&A: 24/07/2015

De Minimis and weighting for foreign exchange risk

Should the own fund requirement of foreign-currency option non-delta risk be calculated by all institutions, or only if the net open FX position is greater than 2%?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 528/2014 - RTS on non-delta risk of options in the standardised market risk approach
  • ID: 2015_1795
  • Topic: Market risk
  • Date of submission:
  • Published as final Q&A: 17/07/2015

Risk-weighting of Pension Assets

Article 36 of the CRR requires that defined benefit pension fund surpluses be deducted from CET1 - unless the bank has unrestricted access to the surplus and has obtained permission from the competent authority, as Article 41 sets out further. Any such accessible surplus then needs to be risk-weighted for credit risk in accordance with Part Three of the CRR. However the CRR is silent on the risk weighting assets for total pension assets. Should pension funds in total, or just the accessible surplus, be risk weighted?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_1567
  • Topic: Own funds
  • Date of submission:
  • Published as final Q&A: 17/07/2015

Reporting of Counterparties on LE2 and LE3 Templates - connected counterparties

Where there exists a group of connected counterparties (i.e. a Parent company and its subsidiary) and the reporting institution has an exposure to the subsidiary but not the parent, can you please clarify whether the code reported on the LE2 template should be that of the parent company or that of the subsidiary. Additionally, where there exists a group of connected counterparties, but the reporting institution only has exposures to one member of the group, should this exposure be detailed on the LE3 template thereby linking the exposure to the parent entity?

  • 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_1562
  • Topic: Supervisory reporting - Large Exposures
  • Date of submission:
  • Published as final Q&A: 10/07/2015

Counterparty credit risk add-on for repurchase transactions

Is it required to calculate and report this counterparty credit risk add-on also for cash borrowers in repo transactions or for the borrowers in securities lending transactions?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1861
  • Topic: Leverage ratio
  • Date of submission:
  • Published as final Q&A: 10/07/2015

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

Applicability of Article 423(1) of the CRR for intermediaries facilitating derivatives clearing between its clients and a CCP

Is it permissible for an institution, for which the following is true, not to apply the additional outflow required under Article 423(1) of Regulation (EU) No 575/2013 (CRR): (i) the institution acts as a financial intermediary in the meaning of Article 303 of the CRR between a client and a central counterparty (CCP) in order to facilitate the central clearing of the clients’ derivatives (as e.g. required in the future by Regulation (EU) no 648/2012 (“EMIR”)); and (ii) it is contractually assured that the institution immediately receives collateral from its clients in case the value of the collateral posted to the institution as margin for its set of derivatives channelled through this intermediary to the CCP is not sufficient to cover the CCP’s margin requests for the set of derivatives.

  • 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_1619
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 10/07/2015

Exemptions from the application of Article 395(1)

Could exposures of an institution fully guaranteed by its parent undertaking - considering the substitution approach under Article 403(1)(a) of Regulation (EU) No 575/2013 (CRR) – be exempted from the large exposures provisions and in this way from the application of Article 395(1)? Furthermore, may the guarantees provided by the parent institutions from another Member State be handled in Article 403 of the CRR as a third party guarantee?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_1592
  • Topic: Large exposures
  • Date of submission:
  • Published as final Q&A: 10/07/2015

Use of ECAI credit assessments for the determination of risk weights

In Article 138 of Regulation (EU) No 575/2013 (CRR) it says that an institution may choose one or more ECAIs to derive risk weights for asset classes. Is there a possibility for institutions not to choose any ECAI at all for the exposure class ‘exposures to Institutions’, and solely rely on the Sovereign Method for the exposure class stated in Article 121? If not, is it possible to choose only one ECAI and use Sovereign Method for all the unrated exposures (i.e. unrated by your chosen ECAI)?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_550
  • Topic: External Credit Assessment Institutions (ECAI)
  • Date of submission:
  • Published as final Q&A: 03/07/2015

Excess of deductions from AT1 items over AT1 capital which must be deducted from CET1, but is caused by the impact of transitional arrangements.

How should the excess of deductions from AT1 items over AT1 capital due to the impact of transitional arrangements, which cannot be done in AT1 because of the existing amount of the instruments in this category is not large enough and thus they must be deducted from CT1, be reflected in the templates C.01.00 and C.05.01?

  • 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: 2015_1740
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 26/06/2015

Basel I floor

Instructions in Annex II regarding the required information about Basel I floor (Annex I, CA4, rows 870, 880, 890, 900) are not clear. For instance some guidance is needed on the required amount in rows 890/900 (80% or 100%)?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Draft ITS on Supervisory Reporting of Institutions
  • ID: 2014_1011
  • Topic: Supervisory reporting - COREP (incl. IP Losses)
  • Date of submission:
  • Published as final Q&A: 26/06/2015