The rule in plain words
Carrying amount cannot be negative.
EBA checks it for 19 rows, from equity instruments (0010) to financial assets designated at fair value through profit or loss (0190). That makes 19 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.
Carrying amount: General governments >= 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 F 04.02.2 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
Rows
- 0010Equity instruments
- 0020No label in EBA’s template
- 0030of which: credit institutions
- 0040of which: other financial corporations
- 0050of which: non-financial corporations
- 0060Debt securities
- 0070Central banks
- 0080General governments
- 0090Credit institutions
- 0100Other financial corporations
- 0110Non-financial corporations
- 0120Loans and advances
- 0130Central banks
- 0140General governments
- 0150Credit institutions
- 0160Other financial corporations
- 0170Non-financial corporations
- 0180Households
- 0190FINANCIAL ASSETS DESIGNATED AT FAIR VALUE THROUGH PROFIT OR LOSS
Column
- 0010Carrying amount
A worked example
The first of its checks, with simple numbers.
General governments, carrying amount 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}.
{F_04.02.2,r0080,c0010,} >= 0The next five:
{F_04.02.2,r0120,c0010,} >= 0{F_04.02.2,r0010,c0010,} >= 0{F_04.02.2,r0070,c0010,} >= 0{F_04.02.2,r0090,c0010,} >= 0{F_04.02.2,r0020,c0010,} >= 0And 13 more, the same formula for the other cells it covers.
Other rules on F 04.02.2
- Accumulated negative changes in fair value due to credit risk on non-performing exposures cannot be more than zero (v5657_s)Blocking
- Equity instruments cannot be less than the sum of three rows (v1220_m)Blocking
- Financial assets designated at fair value through profit or loss must equal the sum of its two parts (v0804_m)Blocking
- Financial assets designated at fair value through profit or loss must equal the sum of its three parts (v0803_m)Blocking
- Loans and advances must equal the sum of its six parts (v0802_m)Blocking
- Debt securities must equal the sum of its five parts (v0801_m)Blocking
- Loans and advances, carrying amount must equal the sum of its two parts (v23380_h)Warning
- Equity instruments, carrying amount must equal the sum of its two parts (v23392_h)Warning
Every FINREP 9 rule, by template
Checks like this one, run at the point of submission, are the first step to real-time supervision.