The rule in plain words
Ad hoc permissions for eligible liabilities items: Predetermined amount plus general prior permissions for eligible liabilities items: Predetermined amount cannot be less than the absolute value of (-) of which: unused prior permission amounts (under (-) own eligible liabilities instruments subordinated to excluded liabilities) plus (-) of which: unused prior permission amounts (under (-) own eligible liabilities instruments not subordinated to excluded liabilities).
All the values are in the minimum requirement for own funds and eligible liabilities (MREL) column (0010) of M 02.00.a.
The headline gives only the kind of check and the template, because the rule is too long to say in a headline. The plain words above say all of it.
How the Line4 Check report words itShowHide
Word for word as the report shows it when the rule fails.
Minimum requirement for own funds and eligible liabilities (MREL): Ad hoc permissions for eligible liabilities items: Predetermined amount + General prior permissions for eligible liabilities items: Predetermined amount >= the absolute value of ((-) Own eligible liabilities instruments subordinated to excluded liabilities, (-) Of which: unused prior permission amounts + (-) Own eligible liabilities instruments not subordinated to excluded liabilities, (-) Of which: unused prior permission amounts)
What to do if your filing fails it
- 01Open the template below and find the cells the rule reads.
- 02Work out both sides from your file, as the rule in plain words sets out, and compare them.
- 03EBA allows a small rounding difference, worked out from the decimals each value is reported with.
- 04It runs only when your filing indicators mark M 02.00 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 capacity and composition (resolution groups / entities) (TLAC1) (I) (M 02.00.a)
Rows
- 0135(-) Of which: unused prior permission amounts
- 0165(-) Of which: unused prior permission amounts
- 0600Ad hoc permissions for eligible liabilities items: Predetermined amount
- 0610General prior permissions for eligible liabilities items: Predetermined amount
Column
- 0010Minimum requirement for own funds and eligible liabilities (MREL)
Show the rule as writtenShowHide
EBA's formula. Cells are written as {template, row, column, sheet}.
{M_02.00.a,r0600,c0010,} + {M_02.00.a,r0610,c0010,} >= abs({M_02.00.a,r0135,c0010,} + {M_02.00.a,r0165,c0010,})Other rules on M 02.00.a
- The absolute value of own eligible liabilities instruments not subordinated to excluded liabilities cannot be less than the absolute value of of which: unused prior permission amounts (v22336_m)Warning
- The absolute value of own eligible liabilities instruments subordinated to excluded liabilities cannot be less than the absolute value of of which: unused prior permission amounts (v22335_m)Warning
- Minimum requirement for own funds and eligible liabilities (MREL) cannot be more than zero (v22346_s)Warning
- Requirement for own funds and eligible liabilities for G-SIIs (TLAC) cannot be more than zero (v10859_s)Warning
- Eligible liabilities items before adjustments must equal the sum of its two parts (v10847_h)Warning
- A calculation check across MREL and TLAC capacity and composition (resolution groups / entities) (TLAC1), and creditor ranking (resolution entities) (TLAC3) (M 06.00, v10813_m)Warning
- Minimum requirement for own funds and eligible liabilities (MREL) must be reported (e10772_e)Warning
- A check on MREL and TLAC capacity and composition (resolution groups / entities) (TLAC1) (I), and MREL and TLAC capacity and composition (resolution groups / entities) (TLAC1) (III) (M 02.00.c, v10769_m)Not run yet
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.