EBA · 2016_2637 Rejected question

Relevant competent authority to determine the same risk weight treatment as the central government

Regulation
Regulation (EU) No 575/2013 (CRR)
Article
115, para. 2
Topic
Credit risk
Submitted by
Credit institution
Submitted
2016-02-19
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Question

Who is the relevant competent authority to determine if the same treatment of regional government exposure and central government exposure can be applied? The national supervisor, the European Commission or the ECB?

Background

As outlined under Article 115 (2) CRR, " EBA shall maintain a publicly available database of all regional governments and local authorities within the Union which relevant competent authorities treat as exposures to their central government ". Austrian local and regional government exposure is currently treated like central government exposure according to the EBA list. If one assumed a default of a region, it would be reasonable not to treat regional government exposure in line with central government exposure and a higher risk weight should apply. But it is unclear who is determining this.
No answer published yet.

Original source: European Banking Authority, Q&A ID 2016_2637

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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