Division — Write-offs/write-downs (3.2B)

In accordance with Regulation (EU) No 1071/2013 (ECB/2013/33), ‘write-down’ means the direct reduction of the carrying amount of a loan on the (statistical) balance sheet owing to its impairment. Similarly, ‘write-off’ means a write-down of the full carrying amount of a loan leading to its removal from the balance sheet. The effects of write-downs and write-offs should be reported with a negative (positive) sign when in net terms they result in a reduction (increase) in outstanding amounts. These data are necessary to allow a full reconciliation between net lending and changes in outstanding amounts.

As regards write-offs/write-downs relating to outstanding loans on the balance sheet, data compiled to comply with the minimum requirements of Part 4 of Annex I to Regulation (EU) No 1071/2013 (ECB/2013/33) (Block 2 of Table 1A on revaluation adjustments) can be used. However, disentangling the impact of loan write-offs/write-downs on securitised or otherwise transferred loans which are not derecognised requires a separate data extraction from the MFIs' internal databases.

Data on outstanding amounts of eligible loans (items 1 and 4) are in principle corrected for the outstanding amounts of provisions in cases where loans are recorded net of provisions on the statistical balance sheet.