QA2018-75 - Amount T01.00

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Feb 01, 2024
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QA2018-75

Question


How should institutions report the liabilities they have in stock? For example, a covered bond that have been issued by the company and has been repurchased in a 100% basis by the institution. From an accounting point of view, the liability will account for a net amount. In balance sheet we will see the repurchase of the ABS as a liability and also a reduction of this liability coming from the assets that backed the security, as there has not been a real transfer of the risk.


Response


In T01.00 the net amount shall be reported, while in T04.00 they should reflect: - Column "C100": liability issuance - Column "C110": as the repurchase has been for the 100% of the value of the ABS the outstanding amount of the instrument should be 0, if not, it should only be shown the part owned by third parties.