EBA · 2022_6458 Rejected question

Reclassified non-trading book positions and the fair valued treatment in accordance to Art 105 (1) CRR

Regulation
Regulation (EU) No 575/2013 (CRR)
Article
105, para. 1
Topic
Accounting and auditing
Submitted by
Individual
Submitted
2022-05-21
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Question

Shall the fair value treatment of trading book positions in accordance with Art 105 (1) CRR be applied for reclassified non-trading book positions pursuant to Art 104a CRR?

Background

Non-trading book positions can be recognized as fair value and amortised costs. Under exceptional circumstances, an institution may reclassify a non-trading book positions booked under amortised costs to a trading book. A strict application of Art 105 CRR requires that the institution processes an accounting reclassification of the related position to fair value. As accounting standards, such as IFRS 9.4.4.1, does not allow under exceptional circumstances a reclassification in accounting treatment, the requirements of CRR and accounting standards interfere with each other.
No answer published yet.

Original source: European Banking Authority, Q&A ID 2022_6458

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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