FINREP Loan commitments, financial guarantees and other commitments given

In template F 09.01.01 of Annex II to Regulation (EU) No 680/2014 (ITS on Supervisory Reporting), the breakdown of off-balance sheet exposures in: loan commitments given; financial guarantee given and other commitments, is set out in accordance with Annex I of Regulation (EU) No 575/2013 as amended by Regulation (EU) 2019/876 (CRR). The scope of ‘loan commitments’ in accordance with the CRR is broader than the definition of ‘loan commitments’ in accordance with IFRS 9 since it includes both ‘irrevocable’ and ‘revocable’ loan commitments. In other terms, some of the loan commitments listed in Annex I CRR do not comply with the definition of loan commitment of IFRS 9 Appendix A because they are ‘revocable’ (they are outside the definition of ‘loan commitments’ of IFRS 9. Please refer also to IFRS 9 BC5.243).   In Annex V, paragraph 104 states that:   104.      Loan commitments, financial guarantees and other commitments given listed in Annex I to CRR may be instruments that are in the scope of IFRS 9 where they are measured at fair value through profit or loss, or where they are subject to the impairment requirements of IFRS 9, as well as instruments that are within the scope of IAS 37 or IFRS 4.     Therefore, the following cases can be identified:   1)         ‘loan commitments’ listed in IFRS 9.2.3 that can be reported under columns 0010 to 0065 in accordance with paragraph 109 of Annex V or under columns 0120 and 0130 in accordance with paragraph 110 of Annex V or they can be outside the template F 9.01.01 (e.g. they are derivatives);   2)         ‘loan commitments’ that meet the IFRS 9 definition of ‘loan commitment’ but they are outside of IFRS 9, except for impairment requirements as stated in IFRS 9.2.1.(g). They shall be reported in columns 0010 to 0065;   3)         ‘loan commitments’ that do not meet the IFRS 9 definition (e.g. they are revocable), then they are entirely dealt with under IAS 37. These commitments are not considered as ‘loan commitments’ in accordance with IFRS 9, therefore neither the impairment requirements of IFRS 9 can be applied. They shall be reported in columns 0100 and 0110.