Question
The onboarding capacity metric requires an estimate of how many clients an institution could onboard at short notice during a crisis or resolution event. With current KYC/CDD rules, onboarding large volumes of clients within a short timeframe is operationally difficult. We would like to understand whether the EBA expects institutions to assume a full standard KYC/CDD procedures, or simplified crisis‑mode checks, particularly when clients have already undergone due‑diligence at another bank.
Background on the question
Different locations provide differing views on how KYC/CDD should be reflected in onboarding capacity calculations. In a real crisis, standard KYC/CDD processes may not be feasible at speed, yet the ITS does not clearly specify what level of due‑diligence should be assumed for this metric. Institutions need clarity to ensure consistent and realistic reporting across jurisdictions.
Answer
The notion of onboarding capacity aims to assess the theoretical capacity of an entity to absorb the critical functions of a failing bank. Specifically, the number of applications from new customers that can be processed over 1 and 7 working days is used as a proxy to assess the onboarding capacity. For this purpose, the definition used for assessing the onboarding capacity implies that KYC was done.