The rule in plain words
Closing balance must equal these three added up:
- Opening balance
- Inflows
- Outflows
EBA checks it for seven columns: non-performing exposures - loans and advances, households, loans collateralised by residential immovable property, non-financial corporations, SMEs, commercial Real Estate (CRE) loans to SMEs, and commercial Real Estate (CRE) loans to NFCs other than SMEs. That makes seven 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.
Non-performing exposures - loans and advances: Closing balance = Opening balance + Inflows + Outflows
What to do if your filing fails it
- 01Open the template below and find the cells the rule reads.
- 02Add up the parts in your file and compare the result with the total.
- 03If they differ, a part is missing, a value sits in the wrong cell, or the total is out of date.
- 04EBA allows a small rounding difference, worked out from the decimals each value is reported with.
- 05It runs only when your filing indicators mark F 24.01 as reported.
- 06This 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
Loans and advances: inflows and outflows of non-performing exposures (F 24.01)
Rows
- 0010Opening balance
- 0020Inflows
- 0120Outflows
- 0320Closing balance
Columns
- 0010Non-performing exposures - loans and advances
- 0020of which: Households
- 0030of which: Loans collateralised by residential immovable property
- 0040of which: Non-financial corporations
- 0050of which: SMEs
- 0060of which: Commercial Real Estate (CRE) loans to SMEs
- 0070of which: Commercial Real Estate (CRE) loans to NFCs other than SMEs
A worked example
The first of its checks, with simple numbers.
Closing balance must then be 2,450.
A file that reports 2,450 passes. One that reports 2,550 fails, by 100.
The numbers are illustrative, reported to the unit, so the rounding tolerance does not change the result.
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_24.01,r0320,c0010,} = {F_24.01,r0010,c0010,} + {F_24.01,r0020,c0010,} + {F_24.01,r0120,c0010,}The next five:
{F_24.01,r0320,c0030,} = {F_24.01,r0010,c0030,} + {F_24.01,r0020,c0030,} + {F_24.01,r0120,c0030,}{F_24.01,r0320,c0050,} = {F_24.01,r0010,c0050,} + {F_24.01,r0020,c0050,} + {F_24.01,r0120,c0050,}{F_24.01,r0320,c0020,} = {F_24.01,r0010,c0020,} + {F_24.01,r0020,c0020,} + {F_24.01,r0120,c0020,}{F_24.01,r0320,c0070,} = {F_24.01,r0010,c0070,} + {F_24.01,r0020,c0070,} + {F_24.01,r0120,c0070,}{F_24.01,r0320,c0040,} = {F_24.01,r0010,c0040,} + {F_24.01,r0020,c0040,} + {F_24.01,r0120,c0040,}And 1 more, the same formula for the other cells it covers.
Other rules on F 24.01
- Outflow due to risk transfers cannot be more than write-offs in the context of risk transfers (v8050_m)Warning
- Outflow due to sale of instruments cannot be more than write-offs in the context of sale of instruments (v8049_m)Warning
- Outflow due to taking possession of collateral cannot be more than write-offs in the context of taking possession of collateral (v8048_m)Warning
- Outflow due to collateral liquidations cannot be more than write-offs in the context of collateral liquidations (v8047_m)Warning
- Outflows cannot be more than outflow of non-performing exposures that became non-performing during the period (v8046_m)Warning
- Outflows must equal the sum of its ten parts (v8045_m)Warning
- Inflow of exposures granted in the past 24 months cannot be less than inflow of exposures granted during the period (v8044_m)Warning
- Inflow due to reclassification from performing forborne cannot be less than inflows reclassified from performing forborne exposures under probation previously reclassified from non-performing (v8043_m)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.