Search for Q&As

Enquirers can use various factors to search for a Q&A:

  • These include searching by the Q&A ID; legal reference, date submitted, technical standard / guideline, or by keyword if known.
  • Searches can be extended to more than one legal act, topic, technical standard or guidelines by making multiple selections (i.e. pressing 'Ctrl' on your keyboard, and selecting the relevant ones from the drop-down lists by left mouse-click).

Disclaimer:

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.

Final Q&As Q&As under review Rejected Q&As Archived Q&As All Q&As

List of Q&A's

Eligibility of pooled assets for liquidity purposes

Please provide your recommendation as to procedure for allocation of assets within collateral pools to encumbered/unencumbered for LCR/NSFR purposes

  • 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Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 680/2014 - ITS on supervisory reporting of institutions (repealed)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_801
  • Topic: Supervisory reporting - Liquidity (LCR, NSFR, AMM)
  • Date of submission:
  • Published as final Q&A: 02/10/2015

Deferred Tax Assets and Liabilities related to the fair value reserves connected to gains or losses on cash flow hedges

In accordance with Article 33(1)(a) of the Regulation (EU) No 575/2013 of the European Parliament and of the Council (CRR), the institutions do not include the fair value reserves related to gains or losses on cash flow hedges in any element of Own Funds (as a result of the specific filter applied). Is it correct to not consider DTA / DTL related to the fair value reserves related to gains or losses on cash flow hedges in the net DTAs deductible from CET1?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1887
  • Topic: Own funds
  • Date of submission:
  • Published as final Q&A: 02/10/2015

Treatment of stock futures under Article 390(3) and Article 327(1)

Does a short position on an equity future contract net off against a long position in its underlying equity, considering that the underlying security and the equity are identical, deliverable, quoted on an official exchange and cleared through the corresponding CCP?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1873
  • Topic: Large exposures
  • Date of submission:
  • Published as final Q&A: 02/10/2015

SME supporting factor

Can you please confirm whether the SME supporting factor can be applied to derivative exposure and Repo exposure?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_1050
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 02/10/2015

Clarification of the treatment of positions in commodities for the purposes of calculating net and gross position according to Article 360(1) of Regulation (EU) No 575/2013 (CRR)

Should long and short positions in the same commodity (or the same derivative based on the commodity) be netted against each other in the first place and then the net and gross positions should be calculated taking into account positions in other derivatives with the same commodity as the underlying instrument?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1813
  • Topic: Market risk
  • Date of submission:
  • Published as final Q&A: 25/09/2015

Number of distinct calculations required to assess materiality of changes to internal IRC models

Regulation (EU) No 529/2014 governs the assessment of materiality of changes and extensions to internal approaches for credit, market and operational risk. According to this regulation a change to the incremental default and migration risk charge (IRC) is to be considered material if within 15 consecutive business days (Article 7a(4)(a)) the thresholds of Article 7a(1)(c)(ii) are breached at least once. According to Article 374(1) CRR institutions may compute the IRC only weekly. Does this mean that?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 529/2014 - RTS on materiality of extensions and changes in the advanced approaches (IRB and AMA)
  • ID: 2015_2058
  • Topic: Market risk
  • Date of submission:
  • Published as final Q&A: 25/09/2015

Market making in several AT1 or T2 instruments

Where an institution applies for a prior permission for repurchase of several Additional Tier 1 or Tier 2 capital instruments according to Article 78(1), second subparagraph, of the CRR, may the predetermined amount of the permission be set for several instruments or must a predetermined amount be set for each instrument?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Regulation (EU) No 241/2014 - RTS for Own Funds requirements for institutions
  • ID: 2015_2042
  • Topic: Own funds
  • Date of submission:
  • Published as final Q&A: 25/09/2015

Recognition of contractual netting of legal entities of a group

Could you please specify whether the last subparagraph of Article 295 of CRR ("Netting across transactions entered into by different legal entities of a group shall not be recognised for the purposes of calculating the own funds requirements."), which applies to all three types of contractual netting agreements from point (a) to (c), does not allow recognition of netting for the purposes of calculating the own funds requirements between two members of the same banking group generally (even on a bilateral basis) or netting other than on a bilateral basis between two members of the same banking group?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_2004
  • Topic: Market risk
  • Date of submission:
  • Published as final Q&A: 25/09/2015

QRRE loss rate

What is meant by loss rate in this context?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1933
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 25/09/2015

Asset Encumbrance & Covered Bonds

Are assets in cover pools that are not necessary to fulfil regulatory requirements deemed to be encumbered for Parts A, B, C and E of the Asset Encumbrance Reporting templates?

  • 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_1817
  • Topic: Securitisation and Covered Bonds
  • Date of submission:
  • Published as final Q&A: 25/09/2015

PD substitution and eligibility of guarantors

Article 202(d) of Regulation (EU) No 575/2013 (CRR) suggests that where risk weighted exposure amounts are calculated under the IRB Approach, a guarantor must have an internal rating in order to be eligible as a guarantor for PD substitution. Can a guarantor, which is rated by an ECAI, and otherwise meets all eligibility requirements but is treated under the Standardised Approach by the institution, be used for PD substitution? How can a guarantee be recognised in this situation?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_1381
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 04/09/2015

Is operational leasing included in annex 1 to Directive 2013/36/EU and shall it be included in a consolidated situation?

Shall companies that have operational leasing as activity be seen as a financial institution in Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No. 648/2012 (“The Regulation”) and should it be included in a consolidated situation?

  • Legal act: Directive 2013/36/EU (CRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_1644
  • Topic: Other issues
  • Date of submission:
  • Published as final Q&A: 28/08/2015

Initial margin for the purpose of hypothetical capital calculation

What amount should be used as the initial margin posted by to the Central Counterparty (CCP) by a clearing member for the purpose of Article 50a of Regulation (EU) No 648/2012 (EMIR), introduced by Article 520 of Regulation (EU) No 575/2013 (CRR)? Does the Article 50b(c) of the EMIR apply to the initial margin? Should the excess initial margin be included?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1889
  • Topic: Market infrastructures
  • Date of submission:
  • Published as final Q&A: 21/08/2015

Validation Rules v0677_m, v0678_m and v0726_m for Leverage Ratio

Are the following validation rules for leverage ratio reporting despite the Delegated Regulation (EU) 2015/62 still applicable? v0677_m {C 43.00.a, r010,c010} = sum({C 45.00.a, c030, (r060-090)}) v0678_m sum({C 43.00.a, c010, (r040-060)}) = sum({C 45.00.a, c030, (r010-050)}) v0726_m {C 45.00.a, r100,c030} = {C 43.00.a, r070,c010} + sum({C 43.00.b, c010, (r080-090, r140, r180-190, r210, r230, r280-290)}) + sum({C 43.00.c, c020, (r080-090, r140, r180-190, r210, r230, r280-290)})

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Delegated Regulation (EU) 2015/62 - DR with regard to the leverage ratio
  • ID: 2015_1899
  • Topic: Supervisory reporting - Leverage ratio
  • Date of submission:
  • Published as final Q&A: 14/08/2015

Related party balances

Given that there is no specific guidance for where to classify Related Party balances in several templates eg 1.1, 1.2, 2.0, should Related Party balances be classifed on the nature of the underlying balance or transaction, e.g. Related Parties Loans and Advances within Loans and Advances?

  • 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_999
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 31/07/2015

LCR inflows/outflows for collateralised stock borrow/lend transactions within 30 day window

The LCR reporting templates for Outflows (C52) and Inflows (C53) do not include a section which allows firms to separate reverse-repo and other secured lending/borrowing transactions between those where collateral is re-hypothecated and those where collateral is not re-hypothecated, to cover the reporting institutions outright short positions. How should firms with matched book, fully collateralised stock borrow/stock lend transactions (which mature within 30 days) segregate these transactions from unmatched repo/reverse-repo transactions? The Basel III templates allow a 0% outflow/inflow in such cases (lines 289-295 and 264 of the Basel III implementation monitoring workbook), when the transaction matures in less than 30 days.

  • 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_987
  • Topic: Supervisory reporting - Liquidity (LCR, NSFR, AMM)
  • Date of submission:
  • Published as final Q&A: 31/07/2015

Reporting of Additions (c010) and Reversals (c020) in Table 16.7

In Table 16.7, Additions (010) and Reversals (c020) of impairment on financial and non-financial assets is required to be reported. In accordance with ITS 2. 102, “Additions” shall be reported when, for the accounting portfolio or main category of assets, the estimation of the impairment for the period results in recognition of net expenses. “Reversals” shall be reported when, for the ac-counting portfolio or main category of assets, the estimation of the impairment for the period result in the recognition of net income. We interpret the rule above as the additions and reversals (columns 010 and 020 re-spectively) shall be reported NET, NOT gross (for the accounting portfolio or main category of assets). This means that, if the net of the asset impairment for the period is positive (net income) it should be listed as a reversal, and, if negative (net expense), it should be listed as additions. Does it imply, for example for T 16,7 row 030 (Available-for-sale financial assets), if for all available for sale fin assets held by the reporting entity, the impairments for the period exceeded reversals, only net impairment (net of reversals) are to be recorded (and the reversals will be reported blank)? Or is the netting rule only applicable to a sub-portfolio of assets within Available-for-sale financial assets class (e.g. municipal bonds). If the netting rule is applicable for an entire fin asset class group (e.g. Available-for-sale financial assets), the reporting in table 16,7 should equal to the reporting in Table 2, row 480. Please clarify.

  • 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_975
  • Topic: Supervisory reporting - FINREP (incl. FB&NPE)
  • Date of submission:
  • Published as final Q&A: 31/07/2015

Client money

To what extent the cash held by a UCITS can be qualified as client money?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1825
  • Topic: MREL
  • Date of submission:
  • Published as final Q&A: 24/07/2015