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

Short positions in financial institution capital instruments

(1) Where a bank holds an item which is treated as a financial institution capital instrument under CRR, can a guarantee or credit default swap over that instrument be considered a short position for the purposes of Articles 45(a), 59(a) or 69(a)? (2) Where a bank has an indirect holding of a financial institution capital instrument, can a guarantee or credit default swap over the host item be considered a short position in the underlying capital instrument for the purposes of Articles 45(a), 59(a) or 69(a)?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_1382
  • Topic: Own funds
  • Date of submission:
  • Published as final Q&A: 20/02/2015

Inclusion of interim profits / Deduction of losses in own funds

1. How should the interim profits be calculated for the purposes of inclusion in own funds? E.g. if the bank has monthly P/L as follows: Jan -10, Feb -20, March +100 (Year-to-date +70). The results are not verified by external audit. Should the bank take deduct the losses from Jan and Feb, but ignore the March gain as it is unaudited (capital impact compared to IFRS equity -100) or can the losses be netted with the gains and the YTD gain (unaudited) be filtered out (capital impact -70)? 2. What constitutes 'adequate level of assurance' in context of verification by external auditors? Is a full audit required or is an interim review sufficient?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_384
  • Topic: Own funds
  • Date of submission:
  • Published as final Q&A: 20/02/2015

Exemption of purchased receivables from Aricle 405's retention requirement

Do the provisions in Article 405(1) of Regulation (EU) No 575/2013 apply to purchased receivables?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_1474
  • Topic: Securitisation and Covered Bonds
  • Date of submission:
  • Published as final Q&A: 20/02/2015

Risk Retention

Can the retention requirements under Article 405 of Regulation (EU) No 575/2013 (CRR) be satisfied by the provider of the junior/first loss funding for a CLO warehouse where such an entity has also been involved in the selection of the exposures and the setting of criteria, as it can be said, in such capacity, to be acting as "originator"? Also, where the warehouse provides financing for the acquisition of the majority of the exposures but further exposures are acquired from different sources after closing (and in accordance with pre-defined criteria), will this prevent the first loss warehouse provider from being the "originator"?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2013_265
  • Topic: Securitisation and Covered Bonds
  • Date of submission:
  • Published as final Q&A: 20/02/2015

Asset transfer in case of sale of business tool

What is the proper basis of transferring assets in case of sale of business tools as referred to in Article 38(1) of Directive 2014/59/EU (BRRD), is it the resolution authority decision or agreement?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1778
  • Topic: Resolution tools and powers
  • Date of submission:
  • Published as final Q&A: 06/02/2015

Liabilities guaranteed by third parties subject to bail-in

The provisions regarding exclusion of "secured liabilities“ from bail-in contained in in Articles 2(2)(67) and 44(2)(b) of Directive 2014/59/EU (BRRD) seem to be ambiguous. We seek clarification as to whether liabilities guaranteed by third parties can be subject to bail-in?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1779
  • Topic: Resolution tools and powers
  • Date of submission:
  • Published as final Q&A: 06/02/2015

Clarificaion of "value of an instrument" in Article 48(2)

We seek clarification regarding Article 48(2) of Directive 2014/59/EU (BRRD), the provision regarding write-down and conversion powers is unclear: the value of an instrument may fluctuate therefore the reference to “value” in Article 48(2) seems ambiguous. We wonder if value refers to the “face value” (“notional amount”) or to the “market value”?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1780
  • Topic: Resolution tools and powers
  • Date of submission:
  • Published as final Q&A: 06/02/2015

Transfer of shareholders in the context of sale of business, Bridge Bank, Asset Separation

1. Is there any rationale for different terminology in Articles 43(2)(b)(i) and 43(2)(b)(ii) of Directive 2014/59/EU (BRRD)? What happens in a situation, when the bridge bank should be wholly owned by the Member State? Does it mean that bridge bank provisions must allow for partial State ownership, or does it mean that the power according to Article 43(2)(b)(i) should not be implemented? 2. What is the procedure for consecutive bail-in after the transfer tools is used?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1781
  • Topic: Resolution tools and powers
  • Date of submission:
  • Published as final Q&A: 06/02/2015

Transfer of assets / Consideration paid by the purchaser

On the basis of Article 39(1) and 38(4)(b) of Directive 2014/59/EU (BRRD), where assets of the holding company are transferred, should the consideration paid by the purchaser benefit the holding, and not the institution under resolution?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1782
  • Topic: Resolution tools and powers
  • Date of submission:
  • Published as final Q&A: 06/02/2015

Transfer of rights and liabilities in the context of the Asset Separation Tool

Can you clarify if there is a distinction between Article 42(1) and Article 42(3) of Directive 2014/59/EU (BRRD): does the assets separation tool allow Resolution Authorities to transfer rights and liabilities as well as assets?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1783
  • Topic: Resolution tools and powers
  • Date of submission:
  • Published as final Q&A: 06/02/2015

Deposit Guarantee Scheme (DGS) contributions couning towards the 8% requirement

On what basis is the 8% in Article 44(5) of Directive 2014/59/EU (BRRD) to be applied? Do Deposit Guarantee Scheme (DGS) contributions count towards the 8% requirement?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1784
  • Topic: Resolution tools and powers
  • Date of submission:
  • Published as final Q&A: 06/02/2015

Approval of business reorganisation plan

Does only the resolution authority have to be satisfied of the business reorganisation plan referred to in Article 52(7)(8) of Directive 2014/59/EU (BRRD) or is the support of the competent authority required also?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1785
  • Topic: Resolution tools and powers
  • Date of submission:
  • Published as final Q&A: 06/02/2015

Resolution powers in relation to third country branches

Article 96 of Directive 2014/59/EU (BRRD) requires Member States to ensure resolution authorities have the powers necessary to act in relation to a third country branch. How can Member States comply with this requirement? What specific actions should the resolution authority be empowered to take in relation to a third country branch? How can a resolution authority take action against a branch given it is not a legal entity?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1786
  • Topic: Cross-border resolution
  • Date of submission:
  • Published as final Q&A: 06/02/2015

Relation between the sale of business tool and take-over bid requirements

Does the reference to 'securities law' in Article 38(1) of Directive 2014/59/EU (BRRD) relate to take-over bid requirements? In general, what is the approach to the exemption to apply securities law requirements? For example, in case of bail-in in for the conversion into capital instruments an alternative in given, and therefore the investor has to decide between two instruments but the conversion is mandatory, could the obligation of prospectus be overridden? The same for a capital increase with pre-emption rights?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1787
  • Topic: Resolution tools and powers
  • Date of submission:
  • Published as final Q&A: 06/02/2015

On-balance sheet netting and exemption from the Large Exposures limits

Are on-balance sheet (OBS) netting agreements, where there are maturity mismatches between loans and deposits, eligible the exemption from the large exposures regime as laid down in Article 400 of Regulation (EU) No 575/2013 (CRR)?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_1508
  • Topic: Large exposures
  • Date of submission:
  • Published as final Q&A: 06/02/2015

Simplified obligations regarding recovery and resolution plans for a subsidiary constituting a significant share in the financial system of a Member State

Is a competent authority in charge of the supervision of a subsidiary constituting a significant share in the financial system of their Member State (according to paragraph 10 of Article 4 Directive 2014/59/EU (BRRD), to submit that request during the process of the assessment of group recovery plans if they want that subsidiary (part of the EU group with parent institution in another Member State) to draw up and submit a recovery plan on an individual basis, required (according to Article 7. paragraph 2) in order for that fact to form part of the joint decision regarding the group recovery plan or is the competent authority allowed to require individual plans to be drawn up independently from joint decision process prescribed in Article 8 of the BRRD? Is a resolution authority in charge of a subsidiary constituting a significant share in the financial system of their Member State (according to Article 4(10) of the BRRD ), if they want to prepare individual resolution plan for that subsidiary (part of the EU group with parent institution in another Member State), allowed to define topics of the resolution plan such as resolution strategy, measures to remove impediments to that strategy and MREL for that particular subsidiary separately from the joint decision process defined in Articles 13, 16, 18 and 45h of the Directive 2014/59/EU (BRRD)?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1788
  • Topic: Simplified obligations
  • Date of submission:
  • Published as final Q&A: 06/02/2015

Notification of stakeholders in the context of intra-group financial support

What is the scope of the obligations imposed by Articles 25(1) and 25(6) of Directive 2014/59/EU (BRRD)?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1789
  • Topic: Intra-group financial support
  • Date of submission:
  • Published as final Q&A: 06/02/2015

On-balance sheet netting and exemption from the Large Exposures limits - question 1

Are on-balance sheet (OBS) netting agreements, where both legs are denominated in different currencies, exempted from the application of Article 395(1) of Regulation (EU) No 575/2013 (CRR)??

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2014_1505
  • Topic: Large exposures
  • Date of submission:
  • Published as final Q&A: 06/02/2015

Differences between proportionality in the CRD IV and Simplified obligations in the BRRD.

In accordance with the Directive 2014/59/EU (BRRD), Article 74(4) of CRD IV will expire when BRRD is implemented. Is the proportionality in the CRD IV different from the simplified obligations in the BRRD?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1793
  • Topic: Interactions with the CRR / CRD IV and the BRRD
  • Date of submission:
  • Published as final Q&A: 06/02/2015

Meaning of "initial" recovery plan

What does the reference to the ‘initial’ recovery plan’ in Article 27(1)(a) of Directive 2014/59/EU (BRRD) mean? Is it the first recovery plan or does it relate to subsequent recovery plans?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2015_1794
  • Topic: Early intervention
  • Date of submission:
  • Published as final Q&A: 06/02/2015