EBA · 2014_1167 Rejected question

Own funds requirements against positions in relevant closely correlated currencies in absence of implementing technical standards

Regulation
Regulation (EU) No 575/2013 (CRR)
Article
354, para. 1 and 3
Topic
Market risk
Submitted by
Investment firm
Submitted
2014-05-08
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Question

Is an institution allowed to apply treatment set out in article 354, paragraph 1 of CRR, in absence of implementing technical standards?

Background

Article 354, paragraph 1 of CRR allows to provide lower own funds requirements against positions in relevant closely correlated currencies. Exact description, when a pair of currencies is deemed to be closely correlated, is provided in the regulation. On the other hand, EBA is ordered, in article 354, paragraph 3, to develop draft implementing technical standards listing the currencies for which the treatment set out in paragraph 1 is available but the relevant ITS has not been published yet. As the way of determination of close correlation is well described, it is reasonable to allow institutions to apply rules set out in paragraph 1.
No answer published yet.

Original source: European Banking Authority, Q&A ID 2014_1167

This Q&A is published by European Banking Authority and is non-binding. It does not constitute legal advice. Updated weekly from official ESA sources.

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