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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

Scope of Article 208 CRR

Does Article 208(3)(a) CRR require institutions to monitor property values of all commercial properties on a yearly basis, regardless of whether they can qualify as eligible collateral for credit risk mitigation?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2020_5470
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 30/09/2022

Outflows from deposits in insurance wrappers

Can cash deposits in insurance wrappers be treated like deposits by Personal Investment Companies (PIC) when computing outflows in the LCR?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Delegated Regulation (EU) 2015/61 - DR with regard to liquidity coverage requirement
  • ID: 2020_5461
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 30/09/2022

Assets requiring stable funding

Where a national competent authority has instructed an institution to hold a pillar 2 liquidity add-on, should the pillar add-on amount be treated as an encumbered asset for the purpose of NSFR reporting?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2020_5272
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 30/09/2022

Multilateral Development Banks (MDBs) not listed in Article 117(2) CRR

Should the multilateral development banks (MDB) which are not included in Article 117(2) CRR be treated as institution? If the head office of that MDB is in a non-equivalent jurisdiction Article 107(3), should the exposure to MDB be treated as corporate?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2020_5164
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 30/09/2022

Recognition of collateral substitution rights in secured funding transactions

Could credit institutions recognise substitution rights on secured funding trades and include any collateral that can be substituted as an unencumbered asset on the reporting date?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Delegated Regulation (EU) 2015/61 - DR with regard to liquidity coverage requirement
  • ID: 2020_5148
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 30/09/2022

Treatment of FX transactions settled via central settlement counterparties i.e. CLS (The Continuous Linked Settlement foreign exchange settlement system)

Can CLS (as a central settlement counterparty) be treated as a counterparty when netting FX transactions according to Article 21 of the Delegated Regulation (EU) 2015/61?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Delegated Regulation (EU) 2015/61 - DR with regard to liquidity coverage requirement
  • ID: 2020_5134
  • Topic: Liquidity risk
  • Date of submission:
  • Published as final Q&A: 30/09/2022

Guarantee for the purpose of the waiver from internal MREL requirements

What amount of the “commitments” referred to in Articles 45f(3) and 45f(4), point (d), BRRD should be covered by the guarantee of the resolution entity or the parent undertaking?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2020_5644
  • Topic: MREL
  • Date of submission:
  • Published as final Q&A: 29/07/2022

Characteristics of the guarantee for the purposes of iMREL waiver

In Article 45f(3) of Directive 2014/59/EU (BRRD), do the "commitments " mentioned refer only to commitments of the subsidiary entered into with external creditors or do they also include intra-group commitments other than those entered into with the guarantor? Please also specify whether the shareholders should be excluded. Is there any other meaning to this term in the resolution framework? Is there a limit for the amount of the guarantee having in mind that the amount of the MREL target for which a waiver is requested would be limited. Is there a minimum duration for the term of the guarantee?

  • Legal act: Directive 2014/59/EU (BRRD)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2020_5581
  • Topic: MREL
  • Date of submission:
  • Published as final Q&A: 29/07/2022

Deduction of pledged own shares from Common Equity Tier 1 items

Should shares pledged to the issuing credit institution as collateral to secure a loan granted by the same credit institution to a customer be deducted from Common Equity Tier 1 items where, in case of default of the customer, the credit institution has the option to either appropriate the collateral or force its sale, bearing in mind that this does not affect the existence of a relationship between the value of the loan and the value of the shares?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2020_5128
  • Topic: Own funds
  • Date of submission:
  • Published as final Q&A: 15/07/2022

Applicability of the SME supporting factor for financing private purposes

Where a natural person’s business activities meet the criteria for an SME, does the SME supporting factor according to Article 501 CRR also apply to exposures from financing private investments of this natural person not directly related to that business?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2021_6301
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 15/07/2022

The size of all non-trading book positions that are subject to foreign exchange risk

According to article 325a, paragrhap 2, is the size of all non-trading book positions that are subject to foreign exchange risk equal to the higher between the total of the net short positions and the total of the net long positions computed according article 352 or is it the sum of absolute value of total of the net short positions and the total of the net long positions?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2021_6269
  • Topic: Market risk
  • Date of submission:
  • Published as final Q&A: 15/07/2022

Implementation of Article 72b(2)(j) of Regulation (EU) No 575/2013 (“CRR”) and whether the contractual provisions governing liabilities are required to refer to the permission regime in order for the liabilities to qualify as eligible liabilities instruments

In question 2013_544, the EBA stated that for Tier 2 instruments, Article 63(j) CRR, in conjunction with Article 77 of the CRR, stipulates that an institution must not effect the call, redemption, repayment or repurchase prior to the date of an instrument's contractual maturity without the prior permission of the competent authority, and that such instruments should therefore contain an explicit reference to these regulatory conditions in their terms. Article 72b(2)(j) CRR states that liabilities may only be called, redeemed, repaid or repurchased early where the conditions set out in Articles 77 and 78a are met. As there is no explicit positive obligation in the legislation to include a reference to the need for resolution authority approval, should eligible liabilities instruments contain an explicit reference to these regulatory conditions in their terms?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2021_6203
  • Topic: Own funds
  • Date of submission:
  • Published as final Q&A: 15/07/2022

Inclusion of undertakings other than institutions, financial institutions or ancillary undertakings in prudential consolidation

Are undertakings other than institutions, financial institutions or ancillary services undertakings unconditionally included in prudential consolidation by effect of Article 18(7) of Regulation (EU) No 575/2013 (CRR) and its requirement to apply the equity method, without being subject to conditions as is the case for full or proportional consolidation according to Article 18(8), or to the thresholds laid down in Article 19(1)?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2021_6189
  • Topic: Other issues
  • Date of submission:
  • Published as final Q&A: 15/07/2022

Cut-off date for the implementation of the adjustment for massive disposals

The last part of the first subparagraph of Article 500 states that "The adjustment referred to in the first subparagraph [(i.e. Adjustment for massive disposals)] may only be carried out until 28 June 2022 and its effects may last for as long as the corresponding exposures are included in the institution's own LGD estimates".  How is 28 June 2022 to be interpreted? Is it a repetition of point (b) of subparagraph 1 (i.e. "the dates of the disposals of defaulted exposures are after 23 November 2016 but not later than 28 June 2022") or it represents the cut-off date by which the adjustment can be estimated?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2021_6174
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 15/07/2022

Scope of ASA definition under IFR

Should all of the assets for which an investment firm provides depositary services (under 2011/61/EU Directive) be included in the definition of assets safeguarded and administered (ASA)?

  • Legal act: Regulation (EU) No 2019/2033 (IFR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2021_5864
  • Topic: K-factor requirements
  • Date of submission:
  • Published as final Q&A: 15/07/2022

Early repayment upon a common agreement between the issuer and the subscriber

Is a clause in provisions governing the capital instruments allowing that the parties (issuer and the investor) may mutually agree to have the issuer repay, at any time, but not before five years after the date of issuance, totally or partially, the principal amount of the capital instrument compliant with the eligibility criteria for own funds instruments?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2021_5720
  • Topic: Own funds
  • Date of submission:
  • Published as final Q&A: 15/07/2022

Definition of the parameter ρ_kl (option maturity)

How is the parameter “ρ_kl (option maturity)” concretely determined? Does the calculation take place at the level of a single option or at the level of weighted net sensitivity, which may consist of several options?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2020_5645
  • Topic: Market risk
  • Date of submission:
  • Published as final Q&A: 15/07/2022

Treatment of non-performing exposures underlying a CIU

Could you clarify if non-performing exposures underlying a CIU should be subject to deductions in accordance with point (m) of Article 36(1) of CRR when using the look-through approach in accordance with Article 132a(1) of CRR or the mandate based approach in accordance with Article 132a(2) of CRR?

  • Legal act: Regulation (EU) No 575/2013 (CRR)
  • COM Delegated or Implementing Acts/RTS/ITS/GLs: Not applicable
  • ID: 2020_5629
  • Topic: Credit risk
  • Date of submission:
  • Published as final Q&A: 15/07/2022