The rule in plain words
Requirement for own funds and eligible liabilities for G-SIIs (TLAC) cannot be negative.
EBA checks it for nine rows, from total risk exposure amount (TREA) (0100) to share of the total non-subordinated liabilities that is included in own funds and eligible liabilities (0360). That makes nine checks. A failure names the one that failed.
How the Line4 Check report words itShowHide
The first of its checks, word for word as the report shows it when it fails. The others read the same, with their own column, row or sheet.
Requirement for own funds and eligible liabilities for G-SIIs (TLAC): Of which containing a write down and conversion clause as referred to in Article 55 of Directive 2014/59/EU >= 0
What to do if your filing fails it
- 01Open the template below and find the cells the rule reads.
- 02Look for a value with the wrong sign in these cells, such as an amount entered as a negative number.
- 03EBA compares the values exactly here: there is no rounding tolerance.
- 04It runs only when your filing indicators mark M 01.00 as reported.
- 05This is a warning. It does not stop the filing on its own, but your authority may ask you to explain it.
The cells it reads
MREL and TLAC key metrics (resolution groups / entities) (KM2) (M 01.00)
Rows
- 0100Total risk exposure amount (TREA)
- 0110Total exposure measure (TEM)
- 0200Own funds and eligibile liabilities
- 0220Of which governed by third country law
- 0230Of which containing a write down and conversion clause as referred to in Article 55 of Directive 2014/59/EU
- 0300Own funds and eligible liabilities as a percentage of the total risk exposure amount
- 0320Own funds and eligible liabilities as a percentage of the total exposure measure
- 0350Aggregate amount of permitted non-subordinated eligible liabilities instruments if the subordination discretion as per Article 72b(3) of Reg
- 0360Share of the total non-subordinated liabilities that is included in own funds and eligible liabilities
Column
- 0020Requirement for own funds and eligible liabilities for G-SIIs (TLAC)
A worked example
The first of its checks, with simple numbers.
Containing a write down and conversion clause as referred to in Article 55 of Directive 2014/59/EU, requirement for own funds and eligible liabilities for G-SIIs (TLAC) must then be at least 0.
A file that reports 0 passes. One that reports -100 fails, by 100.
The numbers are illustrative.
Show the rule as writtenShowHide
EBA's formula, as written out for the first of its checks. Cells are written as {template, row, column, sheet}.
{M_01.00,r0230,c0020,} >= 0The next five:
{M_01.00,r0100,c0020,} >= 0{M_01.00,r0200,c0020,} >= 0{M_01.00,r0360,c0020,} >= 0{M_01.00,r0300,c0020,} >= 0{M_01.00,r0320,c0020,} >= 0And 3 more, the same formula for the other cells it covers.
Other rules on M 01.00
- Minimum requirement for own funds and eligible liabilities (MREL) cannot be negative (v10833_s)Warning
- The sum of three cells cannot be more than liabilities and own funds less excluded liabilities (v10814_m)Not run yet
- Own funds and subordinated liabilities must equal the sum of its two parts (v10756_m)Warning
- Own funds and subordinated liabilities times total exposure measure (TEM) must equal own funds plus eligible liabilities subordinated to excluded liabilities (v10755_m)Warning
- Own funds and subordinated liabilities times total risk exposure amount (TREA) must equal own funds plus eligible liabilities subordinated to excluded liabilities (v10754_m)Warning
- Minimum requirement for own funds and eligible liabilities (MREL) must be reported (e10751_e)Warning
- A calculation check on MREL and TLAC key metrics (resolution groups / entities) (KM2) (v10750_m)Warning
- A calculation check on MREL and TLAC key metrics (resolution groups / entities) (KM2) (v10749_m)Warning
Every MREL and TLAC rule, by template
Checks like this one, run at the point of submission, are the first step to real-time supervision.