EBA updates single rulebook Q&As: 4 July 2014

The European Banking Authority (EBA) has updated its Q&As on the single rulebook, publishing 11 new answers to questions. The Q&As relate to the CRD IV package of reforms: the CRD IV Directive, the Capital Requirements Regulation and the related technical standards and guidelines developed by the EBA. The 11 updated Q&As cover various issues including: supervisory reporting and minimum reserve requirements.

The topics for the new answers are:

supervisory reporting of bonds issued by promotional banks;
mark to market method, application of the mark to market reset 2014;
residual maturity of exposures with an undefined maturity;
regulatory add-on % for inflation swaps;
effect on the capital requirement of a guarantee where the right to call is linked to default versus another where it is linked to realised loss;
own funds, prudential filters;
treatment of SME-supporting factor in the case of secured exposures;
tier 2 instruments;
eligibility of capital instruments for classification as Common Equity Tier 1 (CET1) instruments when the instruments are supplemented by a contractual obligation of the majority-holder of those instruments to pay compensation to the minority shareholders even in loss years;
exemption from deduction of equity holdings in an insurance company from CET1; and
minimum reserve requirement.