Question ID: 3483
Regulation Reference: (EU) 2023/894 - ITS with regard to the templates for the submission of information necessary for supervision
Topic: Solvency Capital Requirement (SCR)
Template: S.06.02
Status: Final
Date of submission: 15 Dec 2025
Question
CIC 21 : Bonds issued by corporations, with simple characteristics, usually covering the ones referred to as ‘plain vanilla’, and that don’t have any special feature described in the categories 22 to 28. The question Plain Vanilla bond with call option (early redemption option) such as Cash call, Ordinary call or Make whole call considered as special feature ? Should the bond with call option be classified as CIC 21 ? Or Should the bond with call option either cash call, ordinary call or make whole call be classified as CIC 29?
Background of the question
Based on the EIOPA definition, a Bond should follow the CIC Code:21 as long as it doesn’t have any special features listed within the categories 22 to 28 within the EIOPA definitions. As per the definitions listed in the sheet “Annex V – Definitions” , “an early full or partial redemption” doesn’t feature in any of the categories from 22 to 28, and hence this characteristic of early redemption doesn’t automatically make such bonds as the ones with “special feature”. Which should still mean that these bonds should be considered as “Plain Vanilla” bonds and further treated as mapped to CIC 21.
EIOPA answer
For information regarding the general classification of bonds, please refer to 3499 - European Insurance and Occupational Pensions Authority.
Based on the examples provided in the question, a plain vanilla bond with ordinary call option should be classified as CIC 21.
In general, decisions if a component or feature of a bond should be considered as special should be taken from a risk perspective.