EBA · 2025_7338 Rejected question

Treatment of factoring in LCR and NSFR

Regulation
Regulation (EU) No 575/2013 (CRR)
Article
411, para. 16
Topic
Supervisory reporting - Liquidity (LCR, NSFR, AMM)
Submitted by
Individual
Submitted
2025-02-10
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Question

For the purpose of Liquidity Coverage Ratio, shall factoring be treated as trade finance (this means to consider a 100% weighted inflow at row 180)?

Background

According to Article  411 (16)(b) of REGULATION (EU) 2019/876 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL, farctoring shall be treated as trade finance, for the purpose of Title IV (THE NET STABLE FUNDING RATIO). With regard to LCR, the COMMISSION DELEGATED REGULATION (EU) 2015/61, Article 32(2)(a)(ii) does not explicitly mention factoring in the definition of trade finance (referring to Article 162(3) of Regulation (EU) No 575/2013). This lack of explicit reference generates inconsistency between the two templates, because in NSFR factoring, as trade finance, is weighted 0.10 (if the maturity is less than six months), while in LCR factoring is not represented in the trade finance row (row 180, 100% weight) , but in the above unsecured rows based on the counterparty type (with weights which vary from 5% to 100%).
No answer published yet.

Original source: European Banking Authority, Q&A ID 2025_7338

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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