On 29 April 2021, the European Banking Authority (EBA) issued a consultation paper on draft regulatory technical standards (RTS) specifying the types of factors to be considered for the assessment of appropriateness of risk weights and the conditions to be taken into account for the assessment of appropriateness of minimum loss given default (LGD) values for exposures secured by immovable property.
The draft RTS have been developed according to Articles 124(4) and 164(8) of the Capital Requirements Regulation (CRR), which mandates the EBA to develop, in close cooperation with the European Systemic Risk Board, draft RTS to specify the types of factors to be considered for the assessment of the appropriateness of the risk weights referred to in the first subparagraph of paragraph 2 of Article 124 of the CRR; and the conditions that the authority designated by the Member State shall take into account when assessing the appropriateness of minimum LGD values as part of the assessment referred to in paragraph 6 of Article 164 CRR.
The deadline for comments on the consultation paper is 29 July 2021.