EBA · 2017_3339 Final Q&A

Validation rule v4886_m

Regulation
Regulation (EU) No 575/2013 (CRR)
Article
99
Topic
Supervisory reporting - COREP (incl. IP Losses)
Submitted by
Investment firm
Submitted
2017-06-12
Answered
2017-12-22
Answer provided by
ESAs (EBA, ESMA, EIOPA)
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Question

A new validation rule v4886_m has been added to taxonomy 2.6 which specifies that : [C 03.00 (r010;030;050;070-120)] {c010} < 1 This rule fails to consider that a firm may hold surplus capital for other purposes (such as Large Exposures) that would cause failure of this rule.

Background

validation error where surplus capital results in a capital ratio >100%

Answer

Validation rule v4886_m checks that the capital ratios reported in template C 03.00 of Annex I to Regulation (EU) No 680/2014 (ITS on Supervisory Reporting) are below 1 (= 100%). This relationship is expected to hold for the vast majority of institutions subject to the obligation to report information in accordance with the provisions of the ITS on Supervisory Reporting. There may be cases where an institution holds excess own funds to the extent that the capital ratios increase above 100%. In those cases, the validation rule can be broken in a justified manner.

Original source: European Banking Authority, Q&A ID 2017_3339

This Q&A is published by European Banking Authority and is non-binding. It does not constitute legal advice. Updated weekly from official ESA sources.

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