The rule in plain words
None of the values it checks in criticality assessment of economic functions (FUNC 1 CM) can be negative.
EBA checks it for two columns: notional amount (0030) and notional amount (0060). And for five rows: derivatives held for trading - OTC, derivatives held for trading - non-OTC, other services / activities / functions (1), other services / activities / functions (2) and other services / activities / functions (3). That makes ten 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.
Notional amount: Derivatives held for trading - non-OTC >= 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 Z 07.01.4 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
Criticality assessment of economic functions (FUNC 1 CM) (Z 07.01.4)
Rows
- 0250Derivatives held for trading - OTC
- 0260Derivatives held for trading - non-OTC
- 0290Other services / activities / functions (1)
- 0300Other services / activities / functions (2)
- 0310Other services / activities / functions (3)
Columns
- 0030Notional amount
- 0060Notional amount
A worked example
The first of its checks, with simple numbers.
Derivatives held for trading - non-OTC, notional 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}.
{Z_07.01.4,r0260,c0060,} >= 0The next five:
{Z_07.01.4,r0250,c0030,} >= 0{Z_07.01.4,r0290,c0030,} >= 0{Z_07.01.4,r0300,c0060,} >= 0{Z_07.01.4,r0260,c0030,} >= 0{Z_07.01.4,r0300,c0030,} >= 0And 4 more, the same formula for the other cells it covers.
Other rules on Z 07.01.4
- Market share cannot be negative (v90223_s)Warning
- Number of counterparties cannot be negative (v90225_s)Warning
- None of the eight values it checks in criticality assessment of economic functions (FUNC 1 CM) can be negative (v90226_s)Warning
- None of the twelve values it checks in criticality assessment of economic functions (FUNC 1 CM) can be negative (v90227_s)Warning
- Market share must be between 0.000001 and 1 (v90337_m)Warning
- A check on criticality assessment of economic functions (FUNC 1 CM) (v90346_m)Not run yet
- A check on criticality assessment of economic functions (FUNC 1 CM) (e7515_e)Not run yet
Every RESOL2 rule, by template
Checks like this one, run at the point of submission, are the first step to real-time supervision.