EBA · 2025_7401 Rejected question

Interaction between CRR3 article 124 and article 193

Regulation
Regulation (EU) No 575/2013 (CRR)
Article
124, para. 1
Topic
Credit risk
Submitted by
Accounting firm
Submitted
2025-04-07
Browse ECB SSM Register → More Q&As on this regulation →

Question

When should an IPRE exposure be riskweighted at 150% according to CRR3 article 124 para 1 (b)?

Background

We are seeking clarification on the interaction between article 124 para 1 (a) and (b) and article 193 para 1. According to CRR3 para 4 (75b) an IPRE exposure must be secured on real estate (either RRE or CRE). Further according to article 124 1 (b) an IPRE exposure shall be assigned a riskweight of 150% and according to CRR3 article 124 para 1 (a) a non-IPRE exposure must be risk weighted as an exposure without collateral (typically risk weight of 100%). Article 124 para 1 (b) therefore seems to be in violation with CRR3 article 193 para 1 where it says the following: "No exposure in respect of which an institution obtains credit risk mitigation shall produce a higher risk-weighted exposure amount or expected loss amount than an otherwise identical exposure in respect of which an institution has no credit risk mitigation".
No answer published yet.

Original source: European Banking Authority, Q&A ID 2025_7401

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.

Similar Q&As

Exposures in default secured by mortgages on residential property

Answered 2023-03-03

Interaction between Articles 473a and 127 of the CRR (risk weight factor for exposures in default under the standardised approach)

Answered 2019-07-19

breakdown of total exposures by risk weights

Answered 2025-03-21

Appropriate risk weight for speculative immovable property financing

Answered 2016-10-21

CRR – assignment of preferential risk weight to part of the loan secured by mortgage

Answered 2014-04-04

More Q&As on this topic

Application of the currency mismatch treatment to self-employed individuals (natural persons carrying out an economic activity) under Article 123a CRR.

Answered 2026-07-31

Requirements for the purpose of treating exposures secured by mortgages on immovable property as duly secured from an RWA computation perspective under CRR Article 124(2) of the CRR.

Answered 2026-05-08

Use of credit assessments by ECAIs not in scope of Regulation (EC) No 1060/2009.

Answered 2026-03-13

US Hard test: adequacy of considering US charge-off rates corresponding to loss rates for exposures secured by residential property or commercial immovable property situated within the territory of the US

Answered 2026-02-27

Application of the SME definition in specific cases

Answered 2025-11-28

📋 Track EU financial regulation continuously

Forseti monitors EU financial regulation and delivers personalised alerts anchored to verified official sources.

Start free trial → Learn more

14-day free trial. No credit card required.