The rule in plain words
For loans and advances to non-financial corporations (excl. reverse repurchase loans): if domestic activities is more than zero, accumulated impairment, accumulated negative changes in fair value due to credit risk for domestic activities (memo item) must be negative.
EBA checks it for four columns: actual current position, planned Year 1 Position, planned Year 2 Position and planned Year 3 Position. That makes four 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.
Planned Year 2 Position: If Domestic activities > 0, then Accumulated impairment, accumulated negative changes in fair value due to credit risk for domestic activities (memo item) < 0
What to do if your filing fails it
- 01Open the template below and find the cells the rule reads.
- 02The check applies only when its first part holds in your file. When it does, the second part must hold too: fix the second part, or correct the first.
- 03EBA compares the values exactly here: there is no rounding tolerance.
- 04It runs only when your filing indicators mark P 01.01 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
Assets (P 01.01)
Rows
- 110Domestic activities
- 111Accumulated impairment, accumulated negative changes in fair value due to credit risk for domestic activities (memo item)
Columns
- 010Actual current position
- 030Planned Year 1 Position
- 040Planned Year 2 Position
- 050Planned Year 3 Position
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}.
if ({P_01.01,r110,c040,} > 0) then ({P_01.01,r111,c040,} < 0) else TrueThe next three:
if ({P_01.01,r110,c030,} > 0) then ({P_01.01,r111,c030,} < 0) else Trueif ({P_01.01,r110,c010,} > 0) then ({P_01.01,r111,c010,} < 0) else Trueif ({P_01.01,r110,c050,} > 0) then ({P_01.01,r111,c050,} < 0) else TrueOther rules on P 01.01
- If loans and advances to non-financial corporations (excl. reverse repurchase loans) is more than zero, domestic activities must be more than zero (v6220_m)Warning
- Loans and advances to households (exc reverse repurchase loans): if domestic activities is more than zero, accumulated impairment, accumulated negative changes in fair value due to credit risk for domestic activities (memo item) must be negative (v6219_m)Warning
- If loans and advances to households (exc reverse repurchase loans) is more than zero, domestic activities must be more than zero (v6217_m)Warning
- Domestic activities must equal the sum of its two parts (v5918_h)Warning
- Each of the 24 values it checks in assets cannot be more than zero (v4391_s)Warning
- None of the 140 values it checks in assets can be negative (v4390_s)Warning
- Total assets must equal the sum of its twelve parts (v4105_m)Warning
- Loans and advances to group entities not within the prudential scope of consolidation (excl. reverse repurchase loans) cannot be more than the sum of two rows (v4104_m)Warning
Checks like this one, run at the point of submission, are the first step to real-time supervision.