Changes from report parliamentary committee draft to plenary report

RemovedRegulation (EU) No 575/2013

AddedPower is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010.’;

RemovedArticle 1 – paragraph 1 – point 170, Article 384 – paragraph 2 – subparagraph 29: Miind = the residual maturity of one or more positions in the same index instrument recognised as an eligible hedge. In the case of more than one positions in the same index instrument, Miind shall be the notional-weighted maturity of all those positions;

Added(35) in Article 112, points (i) and (k) are replaced by the following:

RemovedRegulation (EU) No 575/2013

Added‘(i) exposures secured by mortgages on immovable property and ADC exposures;

RemovedArticle 1 – paragraph 1 – point 170, Article 384 – paragraph 2 – point (b) – Table 1 – line 2: Credit quality / Credit quality step 1 to 3 / 0,5 %

Added(k) subordinated debt exposures;’;

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Added(36) Article 113 is amended as follows :

RemovedArticle 1 – paragraph 1 – point 170, Article 385 – paragraph 1: 1. An institution that meets all the conditions set out in Article 273a(2), or has been permitted by its competent authorities in accordance with Article 273a(4) to apply the approach set out in Article 282, may calculate the own funds requirements for CVA risk as the risk-weighted exposure amounts for counterparty risk for non-trading book and trading book positions respectively, referred to in Article 92(4), points (a) and (f), divided by 12,5.

Added(a) paragraph 1 is replaced by the following:

RemovedRegulation (EU) No 575/2013

Added‘1. To calculate risk-weighted exposure amounts, risk weights shall be applied to all exposures, unless those exposures have been deducted from own funds, in accordance with Section 2, based on the exposure class to which those exposures are assigned and, to the extent specified in Section 2, based on the credit quality of those exposure. Credit quality may be determined by reference to the credit assessments of ECAIs or the credit assessments of export credit agencies in accordance with Section 3. With the exception of exposures assigned to the exposure classes laid down in Article 112, point (a), (b), (c) and (e), where the assessment in accordance with Article 79, point (b) of Directive 2013/36/EU reflects higher risk characteristics than those implied by the credit assessment of the nominated ECAI or export credit agency, the institution shall assign a risk weight at least one credit quality step higher than the risk weight implied by the credit assessment of the nominated ECAI or export credit agency.’;

RemovedArticle 1 – paragraph 1 – point 171 – point a – point i, Article 402 – paragraph 1 – introductory part: For the calculation of exposure values for the purposes of Article 395, institutions may, except where prohibited by applicable national law, reduce the value of an exposure or any part of an exposure that is secured by residential immovable property in accordance with Article 125(1) by the pledged amount of the property value, but by not more than 55 % of the property value, provided that all the following conditions are met:

Added(b) paragraph 3 is replaced by the following:

RemovedRegulation (EU) No 575/2013

Added‘3. Where an exposure is subject to credit protection, the exposure value or the applicable risk weight to that exposure, as appropriate, may be amended in accordance with this Chapter and Chapter 4.’;

RemovedArticle 1 – paragraph 1 – point 171 – point b – point i, Article 402 – paragraph 2 – introductory part: For the calculation of exposure values for the purposes of Article 395, institutions may, except where prohibited by applicable national law, reduce the value of an exposure or any part of an exposure that is secured by commercial immovable property in accordance with Article 126(1) by the pledged amount of the property value, but by not more than 55 % of the property value, provided that all the following conditions are met:

Added(36a) Article 115(3) is replaced by the following:

RemovedRegulation (EU) No 575/2013

Added‘3. Where an exposure is subject to credit protection, the exposure value or the applicable risk weight to that exposure, as appropriate, may be amended in accordance with this Chapter and Chapter 4.

RemovedArticle 1 – paragraph 1 – point 171 – point b – point ii, Article 402 – paragraph 2 – point a: (a) the competent authorities of the Member States have not set a risk weight higher than 60 % for exposures or parts of exposures secured by commercial immovable property in accordance with Article 124(7);

AddedExposures to churches or religious communities constituted in the form of a legal person under public law shall, in so far as they raise taxes in accordance with legislation conferring on them the right to do so, be treated as exposures to regional governments and local authorities. In this case, paragraph 2 shall not apply.’;

RemovedRegulation (EU) No 575/2013

Added(36b) in Article 116(4), the following subparagraph is added:

RemovedArticle 1 – paragraph 1 – point 173 – point d, Article 429c – paragraph 6 – subparagraph 1: By way of derogation from paragraph 1 of this Article, institutions may use the method set out in Part Three, Title II, Chapter 6, Section 4 or 5 to determine the exposure value of derivative contracts listed in Annex II and credit derivatives, but only where they also use that method for determining the exposure value of those contracts for the purposes of meeting the own funds requirements set out in Article 92(1), points (a), (b) and (c).

Added‘EBA shall maintain a publicly available database of all public-sector entities within the Union which relevant competent authorities consider as having no difference in risk as exposures to the central government, regional government or local authority in whose jurisdiction the public-sector entity is established.’;

RemovedRegulation (EU) No 575/2013

Added(37) in Article 119, paragraphs 2 and 3 are deleted;

RemovedArticle 1 – paragraph 1 – point 178 a (new), Article 433a – paragraph 1 – point b – point xv (new): (178 a) in Article 433a(1), point (b), the following point is added : / (xv) Article 449a

Added(38) in Article 120, paragraphs 1 and 2 are replaced by the following:

RemovedRegulation (EU) No 575/2013

Added‘1. Exposures for which a credit assessment by a nominated ECAI is available shall be assigned a risk weight in accordance with Table 3 which corresponds to the credit assessment of the ECAI in accordance with Article 136.

RemovedArticle 1 – paragraph 1 – point 180 – point c (new), Article 433b – paragraph 1 – point a – point v (new): (c) the following point (v) is added: / (v) Article 449a

AddedTable 3

RemovedDirective 2013/36/EU

Added2. Exposures with an original maturity of three months or less for which a credit assessment by a nominated ECAI is available and exposures which arise from the movement of goods across national borders with an original maturity of six months or less and for which a credit assessment by a nominated ECAI is available, shall be assigned a risk weight in accordance with Table 4 which corresponds to the credit assessment of the ECAI in accordance with Article 136.

RemovedArticle 1 – paragraph 1 – point 181 – point ba (new), Article 433c – paragraph 2 – point h (new): (ba) the following point (h) is added: / (h) the information referred to in Article 449a on a semi-annual basis

AddedTable 4

RemovedRegulation (EU) No 575/2013

Added(39) Article 121 is replaced by the following:

RemovedArticle 1 – paragraph 1 – point 182, Article 434 – paragraph 2: 2. Institutions other than small and non-complex institutions shall submit to EBA the disclosures referred to in Article 433a and Article 433c respectively in electronic format, but not later than on the date of the publication of financial statements or financial reports for the corresponding period or as soon as possible thereafter. If the financial reports are published before the submission of supervisory reporting according to Article 430 for the same period, disclosures can be submitted on the same date as supervisory reporting or as soon as possible thereafter. If disclosure is required to be made for a period when an institution does not prepare any financial report, the institution shall submit to EBA the information on disclosures as soon as practicable.

Added‘Article 121 Exposures to unrated institutions

RemovedRegulation (EU) No 575/2013

Added1. Exposures to institutions for which a credit assessment by a nominated ECAI is not available shall be assigned to one of the following grades:

RemovedArticle 1 – paragraph 1 – point 183 – point a, Article 434a – paragraph 1: EBA shall develop draft implementing technical standards to specify uniform reporting and disclosure formats, the associated instructions, information on the resubmission policy and IT solutions for disclosures required under Titles II and III. EBA shall ensure that disclosures in accordance with this Regulation do not exceed reporting in accordance with Part Seven A.;

Added(a) where all of the following conditions are met, exposures to institutions shall be assigned to Grade A:

RemovedRegulation (EU) No 575/2013

Added(i) the institution has adequate capacity to meet its financial commitments, including repayments of principal and interest, in a timely manner, for the projected life of the assets or exposures and irrespective of the economic cycles and business conditions;

RemovedArticle 1 – paragraph 1 – point 184 – point b, Article 438 – point d: (d) the total risk exposure amounts as calculated in accordance with Article 92(3) and the corresponding own funds requirements as determined in accordance with Article 92(2), to be broken down by the different risk categories or risk exposure class, as applicable, set out in Part Three and, where applicable, an explanation of the effect on the calculation of own funds and risk-weighted exposure amounts that results from applying capital floors and not deducting items from own funds;;

Added(ii) the institution meets or exceeds the requirement laid down in Article 92(1), the specific own funds requirements referred to in Article 104a of Directive 2013/36/EU, the combined buffer requirement defined in Article 128, point (6), of Directive 2013/36/EU and any equivalent or additional local supervisory or regulatory requirements in third countries, insofar as those requirements are published and are to be met by Common Equity Tier 1 capital, Tier 1 capital or own funds;

RemovedRegulation (EU) No 575/2013

Added(iii) information about the requirements referred to in point (ii) is publicly disclosed or otherwise made available;

RemovedArticle 1 – paragraph 1 – point 184 – point c a (new), Article 438 – point e: (ca) point (e) is replaced by the following: / ‘(e) the on- and off-balance-sheet exposures, the risk-weighted exposure amounts and associated expected losses for each category of specialised lending referred to in Table 1of Article 153(5) and the on- and off-balance-sheet exposures and risk-weighted exposure amounts for the categories of equity exposures set out in Article 133(3) to (6) and Article 495a(3).’;

Added(iv) the assessment in accordance with Article 79 of Directive 2013/36/EU has not revealed that the institution does not meet the conditions set out in points (i) and (ii);

Removed(https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32013R0575&from=EN)

Added(b) where all of the following conditions are met and at least one of the conditions in point (a) is not met, exposures to institutions shall be assigned to Grade B:

RemovedRegulation (EU) No 575/2013

Added(i) the institution is subject to substantial credit risk, including repayment capacities that are dependent on stable or favorable economic or business conditions;