Exit from forbearance classification in non-performing status if forbearance measures failed.

The discontinuation of the forbearance status follows the provisions of paragraph 176 of Regulation (EU) No 680/2014 – ITS on Supervisory Reporting of institutions (ITS). To cease being identified as forborne, an exposure shall, among other requirements, be considered as performing. The discontinuation of the non-performing status of a forborne exposure is governed by the provisions of paragraph 157, as specified by Q&A 2014_735 . It follows from this paragraph that the non-performing classification of a forborne exposure cannot be discontinued when the exposure is classified as impaired or defaulted, or where there is any past-due amount or concern regarding the full repayment of the exposure according to the post-forbearance conditions. In case forbearance measures do not result in an improvement in the situation of the debtor but in a court procedure, leading to a compulsory settlement, bankruptcy or foreclosure, the exposure to which forbearance measures is related should remain classified as non-performing forborne exposure and reported as such in FINREP. Indeed, the court procedure can be considered as a default event in application of Article 178(3)(e) and (f) of Regulation (EU) 575/2013 (CRR), and even if it were not identified as a default event, it evidences a concern regarding the full repayment of the exposure according to the post-forbearance conditions.