BETA

71 Amendments of Danuta Maria HÜBNER related to 2021/0342(COD)

Danuta Maria HÜBNER

Proposal for a regulation
Recital 15

(15) To ensure that the impacts of the output floor on low-risk residential mortgage lending by institutions using IRB approaches are spread over a sufficiently long period and thus avoid disruptions to that type of lending that could be caused by sudden increases in own funds requirements, it is necessary to provide for a specific transitional arrangement. For the duration of the arrangement, when calculating the output floor, IRB institutions should be able to apply a lower risk weight to the part of their residential mortgage exposures that is considered secured by residential property under the revised SA-CR. To ensure that the transitional arrangement is available only to low-risk mortgage exposures, appropriate eligibility criteria, based on established concepts used under the SA-CR, should be set. The compliance with those criteria should be verified by competent authorities. Because residential real estate markets may differ from one Member States to another, the decision on whether to activate the transitional arrangement should be left to individual Member States. The use of the transitional arrangement should be monitored by EBA.deleted

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 1 – point k

Regulation (EU) No 575/2013
Article 4 ¬ paragraph 1 ¬ point 52

(52) ‘operational risk’ means the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events, including, but not limited to, legal risk, model risk and ICT risk, but not strategic and reputational risk;;

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 1 – point l

Regulation (EU) No 575/2013
Article 4 – paragraph 1 – point 52a – introductory part

(52a) ‘legal risk’ means risk of losses, including, but not limited to, expenses, fines, penalties or punitive damages, ~~caused by~~which an institution may incur as a consequence of events that result in legal proceedings, including the following:

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 1 – point l

Regulation (EU) No 575/2013
Article 4 – paragraph 1 – point 52b – introductory part

(52b) ‘model risk’ means the risk of loss an institution may incur as a consequence of decisions that could be principally based on the output of internal models, due to errors in the development, implementation or use of such models, including the following:

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 1 – point l

Regulation (EU) No 575/2013
Article 4 – paragraph 1 – point 52d

(52d) ‘environmental, social or governance (ESG) risk’ means the risk ~~of losses~~ arising from any negative financial impact on the institution stemming from the current or prospective impacts of environmental, social or governance (ESG) factors on the institution’s counterparties or invested assets; (This amendment applies throughout the text.)

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 1 – point l

Regulation (EU) No 575/2013
Article 4 ¬ paragraph 1 ¬ point 52g

(52g) ‘transition risk’, as part of the overall environmental risk, means the risk ~~of losses~~ arising from any negative financial impact on the institution stemming from the current or prospective impacts of the transition ~~of business activities and sectors~~ to an environmentally sustainable economy on the institution’s counterparties or invested assets;

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 1 – point m

Regulation (EU) No 575/2013
Article 4 – paragraph 1 – point 55

(55) ‘loss given default’ or ‘LGD’ means the ~~expected~~ ratio of the loss on an exposure related to a single facility due to the default of an obligor or facility to the amount outstanding at default, and, in the context of dilution risk, the loss given dilution meaning the expected ratio of the loss on an exposure due to dilution, to the amount outstanding according to the pledged or purchased receivable;

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 1 – point m

Regulation (EU) No 575/2013
Article 4 – paragraph 1 – point 56

(56) ‘conversion factor’ or ‘credit conversion factor’ or ‘CCF’ means the ~~expected~~ ratio of the currently undrawn amount of a commitment from a single facility that could be drawn from a single facility before default and that would therefore be outstanding at default to the currently undrawn amount of the commitment from that facility, the extent of the commitment being determined by the advised limit, unless the unadvised limit is higher;;

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 1 – point s

Regulation (EU) 575/2013
Article 4 – paragraph 1 – point 75e

(75e) ‘exposure secured by residential property’, or ‘exposure secured by a mortgage on residential property’, or ‘exposure secured by residential property collateral’, or ‘exposure secured by residential immovable property’, means an exposure secured by a mortgage on residential property or secured by any other mechanisms other than mortgages but which are economically equivalent to mortgages and recognised as collateral on residential property under the applicable national law setting out the conditions for the establishment of those mechanisms;residential immovable property; (The same applies to points 75f and 75g, accordingly to the context of those points.)

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 13

Regulation (EU) No 575/2013
Article 49 ¬ paragraph 4 – subparagraph 2

~~The holdings in respect of which deduction is not made in accordance with paragraphs 2 or 3 shall qualify as exposures and shall be risk weighted at 100 %.;~~deleted

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 23 – point a

Regulation (EU) No 575/2013
Article 92 ¬ paragraph 3 – point b

(b) for the purposes set out in points (i) and (ii), the total risk exposure amount shall be calculated in accordance with paragraph 6: (i) institution in a Member State, for the purposes of complying with obligations of this Regulation on its individual basis; (ii) in case of a parent institution in a Member State, a parent financial holding company in a Member State or a parent mixed financial holding company in a Member State, for the purposes of complying with obligations of this Regulation on the basis of its consolidated situation;deleted in case of a stand-alone subsidiary

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 23 – point a

Regulation (EU) No 575/2013
Article 92 ¬ paragraph 3 – point c

(c) for the purposes of complying with the obligations of this Regulation oin an ~~individual basis,~~ y case other t~~otal risk exposure amount of an institution which is neither a stand-alone institution in the EU nor a stand-alone subsidiary institution in a Member State~~han the cases referred to in point (a) of this paragraph, the total risk exposure amount shall be the un-floored total risk exposure amount calculated in accordance with paragraph 4.

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 23 – point b

Regulation (EU) 575/2013
Article 92 ¬ paragraph 6

6. The total risk exposure amount of an entity ‘i’ for the purposes set out in paragraph 3, point (b), shall be calculated as follows: null where: i = the index that denotes the entity; TREAi = the total risk exposure amount of entity i; U-TREAi = the un-floored total risk exposure amount of entity i calculated in accordance with paragraph 4; DIconso = any positive difference between the total risk exposure amount and the un-floored total risk exposure amount for the consolidated situation of the EU parent institution, EU parent financial holding company or EU parent mixed financial holding company of the group that entity i is part of, calculated as follows: null where: U-TREA = the un-floored total risk exposure amount calculated in accordance with paragraph 4 for that EU parent institution, EU parent financial holding company or EU parent mixed financial holding company on the basis of its consolidated situation; TREA = the total risk exposure amount calculated in accordance with paragraph 3, point (a), for that EU parent institution, EU parent financial holding company or EU parent mixed financial holding company on the basis of its consolidated situation. Contribconsoi = the contribution of entity i, calculated as follows: null where: j = the index that denotes all entities that are part of the same group as entity i for the consolidated situation of the EU parent institution, EU parent financial holding company or EU parent mixed financial holding company; U-TREAj = the un-floored total risk exposure amount calculated by entity j in accordance with paragraph 4 on the basis of its consolidated situation or, in case entity j is a stand-alone subsidiary institution in a Member State, on its individual basis; F-TREAj = the floored total risk exposure amount of entity j calculated on the basis of its consolidated situation as follows: null where: F-TREAj = the floored total risk exposure amount calculated by entity j on the basis of its consolidated situation or, in case entity j is a stand-alone subsidiary institution in a Member State, for its individual basis; S-TREAj = the standardised total risk exposure amount calculated in accordance with paragraph 5 by entity j on the basis of its consolidated situation or, in case entity j is a stand-alone subsidiary institution in a Member State, for its individual basis; x = 72,5 %.deleted

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 26

Regulation (EU) No 575/2013
Article 104 ¬ paragraph 2 – subparagraph 3

For the purposes of point (i), an institution shall split the embedded option from its own liability or from the other instrument in the non-trading book that relate to credit or equity risk ~~and~~. It shall assign, the embedded option to the trading book and shall leave the own liability or the other instrument ~~to the trading or to~~in the non-trading book~~, as appropriate, in accordance with this Article~~.

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 41

Regulation (EU) No 575/2013
Article 122a ¬ paragraph 3 ¬ point a – introductory part

(a) where the purpose of a specialised lending exposure is to finance the acquisition of physical assets, including ships, aircraft, satellites, railcars, and fleets, and the income to be generated by those assets comes in the form of cash flows generated by the specific physical assets that have been financed and pledged or assigned to the lender by one or several third parties (‘object finance exposures’), institutions shall apply ~~the following~~a risk weights of 100%:

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 41

Regulation (EU) 575/2013
Article 122a ¬ paragraph 3 ¬ point a – point i

(i) 80 % where the exposure is deemed to be high quality when taking into account all of the following criteria: — obligations even under severely stressed conditions due to the presence of all of the following features: — adequate exposure-to-value of the exposure; — conservative repayment profile of the exposure; — of the assets upon full pay-out of the exposure or alternatively recourse to a protection provider with high creditworthiness; — exposure by the obligor or that risk is adequately mitigated by a commensurate residual asset value or recourse to a protection provider with high creditworthiness; — the obligor has contractual restrictions over its activity and funding structure; — for risk-mitigation purposes; — properly managed; — the assets provide lenders with a high degree of protection including the following features: — enforceable first-ranking right over the assets financed, and, where applicable, over the income that they generate; — on the ability of the obligor to change anything to the asset which would have a negative impact on its value; — construction, the lenders have a legally enforceable first-ranking right over the assets and the underlyingdeleted the obligor can meet its financial commensurate remaining lifetime low refinancing risk of the the obligor uses derivatives only material operating risks are the contractual arrangements on the lenders have a legally there are construaction contracts; — of the following standards to operate in a sound and effective manner: — asset are tested; — authorisations for the operation of the assets have been obtained; — construction, the obligor has adequate safeguards on the agreed specifications, budget and completion date of the asset, including strong completion guarantees or the involvement of an experienced constructor and adequate contract provisions for liquidated damages;ual restrictions where the asset is under the assets being financed meet all the technology and design of the all necessary permits and where the asset is under

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 41

Regulation (EU) 575/2013
Article 122a – paragraph 3 – point a – point ii

~~(ii) 100 % where the exposure is not deemed to be high quality as referred to in point (i);~~deleted

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 41

Regulation (EU) 575/2013
Article 122a – pragraph 3 – point c – introductory part

(c) where the purpose of a specialised lending exposure is to finance a ~~project~~single project, either in the form of construction of a new capital installation or refinancing of an existing installation, with or without improvements, in particular projects for the development or acquisition of large, complex and expensive installations, including power plants, chemical processing plants, mines, transportation infrastructure, environment, and telecommunications infrastructure, and the income to be generated by the ~~project is the money generated by the contracts for the output of the installation obtained from one or several parties which are no~~financed project serves both as the primary source of repayment uand~~er management control of the sponsor~~ as security for the loan (‘project finance exposures’), institutions shall apply the following risk weights:

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 41

(ii) ~~provided that the adjustment to own funds requirements for credit risk referred to in Article 501a is not applied,~~ 80 % where the project to which the exposure is related is in the operational phase and the exposure meets all of the following criteria:

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 41

Regulation (EU) 575/2013
Article 122a – paragraph 3 – point c – point ii – indent 2

— the obligor has sufficient reserve funds fully funded in cash, or other financial arrangements~~, with highly rated guarantors~~ to cover the contingency funding and working capital requirements over the lifetime of the project being financed;

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 41

Regulation (EU) 575/2013
Article 122a – paragraph 3 – point c – point ii – indent 3

— the ~~obligor generates cash flows that are predictable and cover all future loan repayments~~income generated by the financed project is availability-based or subject to a rate-of-return regulation or take-or-pay contract; for this purpose "availability-based" means that, once construction is completed, the obligor is entitled, as long as contract conditions are fulfilled, to payments from its contractual counterparties which cover operating and maintenance costs, debt service costs and equity returns as the obligor operates the project, and these payments are not subject to swings in demand, such as traffic levels, and are adjusted typically only for lack of performance or lack of availability of the asset to the public;

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 41

Regulation (EU) 575/2013
Article 122a – paragraph 3 – point c – point ii –indent 5

— the main count~~ractual arrangements~~erparty or other counterparties which meet the eligibility criteria for the main counterparty effectively protect the lending institution against losses resulting from the termination of the project;

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 41

Regulation (EU) 575/2013
Article 122a – paragraph 3 – point c – point ii – indent 8

— ~~equity is pledged to~~ the lending institution is~~uch that they are~~ able to take control of the obligor entity ~~upon defaul~~in case of a default event;

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 42

Regulation (EU) 575/2013
Article 123 ¬ paragraph 1 – point a – introductory part

(a) the total exposure ~~is either of the following:~~value aggregated across all exposures to the obligor or group of connected clients, including any exposure in default but excluding exposures secured by residential property up to the property value, shall not, to the knowledge of the institution, which shall take reasonable steps to confirm the situation, exceed EUR 1 million;

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 42

Regulation (EU) 575/2013
Article 123 – paragraph 1 – point a – point i

~~(i) an exposure to one or more natural persons;~~deleted

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 42

Regulation (EU) 575/2013
Article 123 – paragraph 1 – point a – point ii

(ii) an exposure to an SME within the meaning of Article 5, point (8), where the total amount owed to the institution, its parent undertakings and its subsidiaries, by the obligor or group of connected clients, including any exposure in default but excluding exposures secured by residential property up to the property value shall not, to the knowledge of the institution, which shall take reasonable steps to confirm the situation, exceed EUR 1 million;deleted

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 42

Regulation (EU) 575/2013
Article 123 – paragraph 1 – subparagraph 1 a (new)

Where any of these criteria are not met for an exposure to one or more natural persons, the risk weight shall be 100%.

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 42

Regulation (EU) 575/2013
Article 123 ¬ paragraph 4

4. By way of derogation from paragraph 3, exposures due to loans granted by an institution to pensioners or employees with a permanent contract against the unconditional transfer of part of the borrower’s pension or salary to that institution shall be assigned a risk weight of 35 %, provided that all the following conditions are met: (a) unconditionally authorises the pension fund or employer to make direct payments to the institution by deducting the monthly payments on the loan from the borrower’s monthly pension or salary; (b) work, unemployment or reduction of the net monthly pension or salary of the borrower are properly covered through an insurance policy to the benefit of the institution; (c) by the borrower on all loans that meet the conditions set out in points (a) and (b) do not in aggregate exceed 20 % of the borrower’s net monthly pension or salary; (d) the loan is equal to or less than ten years.;deleted to repay the loan, the borrower the risks of death, inability to the monthly payments to be made the maximum original maturity of

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 43

Regulation (EU) 575/2013
Article 123a ¬ paragraph 1 – introductory part

1. ~~Exposures to~~Where the following conditions are met for an exposure to a natural person or natural persons which is assigned to any of the exposures classes laid down in point (h) or, if it is secured by residential immovable property, which is assigned to the exposure class laid down in (i) of Article 112, the risk weight assigned to that exposure in accordance with Chapter 2 shall be multiplied by a factor of 1,5, whereby the resulting risk weight shall not be higher than 150 %~~, where the following conditions are met~~.

2022/08/11
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 63 – point a

Regulation (EU) No 575/2013
Article 150 – paragraph 1 – subparagraph 1 – point c

(c) exposures assigned to exposure classes for which institutions have not received the prior permission of the competent authorities to use the IRB Approach for the calculation of the risk- weighted exposure amounts and expected loss amounts.

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 63 – point a

Regulation (EU) No 575/2013
Article 150 ¬ paragraph 1 – subparagaraph 2

An institution that is permitted to use the IRB Approach for the calculation of risk- weighted exposure amounts and expected loss amounts for a given exposure classes may, subject to the competent authority’s prior permission, apply the Standardised Approach for some types of exposures within that exposure classes where those types of exposures are immaterial in terms of size and perceived risk profile.

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 63 – point a

Regulation (EU) No 575/2013
Article 150 ¬ paragraph 1 – subparagraph 3

An institution that is permitted to use the IRB Approach for the calculation of risk- weighted exposure amounts for only some types of exposures within an exposure class, shall apply the Standardised Approach for the remaining types of exposures within that exposure class.;deleted

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 64 – point -a (new)

Regulation (EU) 575/2013
Article 151 ¬ paragraph 1

(- a) paragraph 1 is replaced by the following: "1. The risk-weighted exposure amounts for credit risk for exposures belonging to one of the exposure classes referred to in points (a) ~~to (e)~~ and (g) of 147(2) shall, unless deducted from own funds, be calculated in accordance with Sub-section 2 except where those exposures are deducted from Common Equity Tier 1 items, Additional Tier 1 items or Tier 2 items. ~~((https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02013R0575-20220410))~~The risk-weighted exposure amounts for credit risk for exposures belonging to the exposure class referred to in point (e1) of Article 147(2) shall, unless deducted from own funds, be calculated in accordance with Article 152 except where those exposures are deducted from Common Equity Tier 1 items, Additional Tier 1 items or Tier 2 items. " Or. en

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 74 – point c

Regulation (EU) No 575/2013
Article 161 ¬ paragraph 5 – subparagraph 1

5. For the purposes of paragraph 4, the LGD input floors in Table 2a in that paragraph for exposures fully secured with FCP shall apply when the value of the FCP, after the application of the volatility adjustments Hc and Hfx concerned in accordance with Article 230, is equal to or exceeds the value of the underlying exposure. In addition, those values shall be applicable for FCP eligible pursuant to this Chapter. In this case, the type of FCP "Other physical collateral" in Table 2aaa of Article 230 shall be understood as "Other physical and other eligible collateral".

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 77 – point d

Regulation (EU) No 575/2013
Article 164 – paragraph 4a – subparagraph 1 a (new)

For purposes of point (b), the type of FCP "Other physical collateral" in Table 2aaa of Article 230 shall be understood as "Other physical and other eligible collateral"

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 77 – point d

Regulation (EU) No 575/2013
Article 164 – paragraph 4b

4b. Where an institution is not able to recognise the effects of the FCP securing one of the exposures of that type of exposures in the own LGD estimates, the institution shall be permitted to apply the formula set out in Article 230, with the excepTo the extent that an institution recognises FCP under the IRB Approach, the institution may recognize the FCP in the calculation ~~that~~of the LGDU term in that formula shall be the institution’s own LGD estimate. In that case, the FCP shall be eligible in accordance with Chapter 4 and the institution own LGD estimate used as LGDU term shall be calculated based on underlying losses data excluding any recoveries arising from that FCP.; input floor for secured exposures. Otherwise, the LGD input floor for unsecured exposures shall apply. '

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 83

Regulation (EU) No 575/2013
Article 171 – paragraph 3

3. Although the time horizon used in PD estimation is one year, institutions shall use a longer time horizon in assigning ratings. A borrower rating must represent the institution's assessment of the borrower's ability and willingness to contractually perform despite adverse economic conditions or the occurrence of unexpected events. Rating systems shall be designed in such a way that idiosyncratic or industry- specific changes are a driver of migrations from one grade to another. In addition, business cycles effects shall be taken into account as a driver for migrations of obligors and facilities from one grade or pool to another.;

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 90 – point a – point iv

Regulation (EU) No 575/2013
Article 180 ¬ paragraph 1 – subparagraph 1 a

‘For the purposes of point (h), where the available observation period spans a longer period for any source, and this data is relevant, this longer period shall be used. The data shall ~~include a~~be representative ~~mix of good and bad year~~of the likely range of variability of default rates relevant for the type of exposures. Subject to the permission of competent authorities, institutions which have not received the permission of the competent authority pursuant to Article 143 to use own estimates of LGDs or conversion factors may use, when they implement the IRB Approach, relevant data covering a period of two years. The period to be covered shall increase by one year each year until relevant data cover a period of five years.’;

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 90 – point b – point iii

Regulation 575/2013
Article 180 ¬ paragraph 2 – subparagraph 2 a

For the purposes of point (e), where the available observation spans a longer period for any source, and where those data are relevant, such longer period shall be used. The data shall ~~contain a~~be representative ~~mix of good and bad years of the economic cycle~~of the likely range of variability of default rates relevant for the type of exposures. The PD for each rating grade shall be based on the observed historical average one-year default rate that is a simple average based on the number of obligors (count weighted), or based on the number of facilities only where the definition is default is applied at individual credit facility level pursuant to Article 178(1) second subparagraph, and other approaches, including exposure-weighted averages, shall not be permitted. Subject to the permission of the competent authorities, institutions may use, when they implement the IRB Approach, relevant data covering a period of two years. The period to be covered shall increase by one year each year until relevant data cover a period of five years.;

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 92 – point a a (new)

Regulation (EU) No 575/2013
Article 182 ¬ paragraph 1 a (new)

~~(https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02013R0575-20220410)~~(a a) the following paragraph is inserted: '1a. Institutions shall ensure that their CCF estimates are effectively quarantined from the potential effects of region of instability caused by a facility being close to being fully drawn at reference date.' Or. en

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 92 – point a b (new)

Regulation (EU) No 575/2013
Article 182 ¬ paragraph 1 b (new)

~~(https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02013R0575-20220410)~~(a b) the following paragraph is inserted: '1b. Reference data must not be capped at the principal amount outstanding of a facility or the available facility limit. Accrued interest, other due payments and drawings in excess of facility limits must be included in the reference data.’ Or. en

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 103 – point a – point i

Regulation (EU) No 575/2013
Article 208 – paragraph 3 – point b – subparagraph 1 a

The value of the property shall not exceed the average value measured for that property or for a comparable property over the last three years in case of commercial immovable property, and over the last six years in case of residential propertyproperty value used for an exposure secured by an immovable property shall not exceed the property value of this immovable property measured when the institutions entered that exposure. Modifications made to the property that improve the energy efficiency of the building or housing unit shall be considered as unequivocally increasing its value.;

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 103 – point b

3a. In accordance with paragraph 3 and subject to the approval of the competent authorities, institutions may carry out the ~~valuation and revalu~~monitoring of the property value and the indentification of thimmovable property ~~value~~in need of revaluation by means of advanced statistical or other mathematical methods (‘models’), developed independently from the credit decision process, subject to the fulfilment of the following conditions:

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 103 – point b

Regulation (EU) No 575/2013
Article 208 ¬ paragraph 3a – point a

(a) the institutions set out, in their policies and procedures, the criteria for using models to ~~valuate, revaluate and~~ monitor the values of collateral and to identify immovable property in need of revaluation. Those policies and procedures shall account for such models’ proven track record, property-specific variables considered, the use of minimum available and accurate information, and the models’ uncertainty;

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 103 – point b

Regulation (EU) No 575/2013
Article 208 ¬ paragraph 3a – point c

(c) the institutions are ultimately responsible for the appropriateness and performance of the models, the valuer referred to in paragraph 3, point (b), is responsible for the valuation ~~that is made~~of immovable property for which the need for revaluation has been identified using the models and the institutions understand the methodology, input data and assumptions of the models used;

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 103 – point b

Regulation (EU) No 575/2013
Article 208 ¬ paragraph 3a – point e

(e) the institutions have in place adequate IT processes, systems and capabilities and have sufficient and accurate data for any model-based ~~valuation or revaluation of collateral~~monitoring of the value of immovable property collateral and identification of properties in need of revaluation;

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 130a (new)

Regulation (EU) No 575/2013
Article 284 – paragraph 6

~~Effective EPE is the average~~(130a ) Article 284(6) is replaced by the following: 6. The calculation of Effective EPE ~~during the first year of future exposure. If all~~shall not include the effect of trade-related cash flow payments from the institution to the defaulting countracts in the netting set mature within less than one year, EPE shall be the average of EE until all contracts in the netting set mature. Effective EPE shall be calculated as a weighted average of Effective EE: where the weights Δtk= tk – tk–1 allow for the case when future exposureerparty and vice versa for margined trading during the margin period of risk. The impact of such trade- related cash flow payments shall be taken into account by adding to Effective EPE the term: Where: expected spike exposures is calculated as the expected exposure increase due to trade-related cash flow payments from the institution to the defaulting counterparty during the margin period of risk that are possible due to contractual provisions (e.g. grace periods), the default notification and management processes of the institution and due to applicable settlement netting rules for such cash flows, which can also include variation margin payments isf c~~alculated at dates that are not equally spaced over time~~ ontractually agreed; denotes the time period inside the margin period of risk attached to the time grid point where such payments are possible, expressed in units of a year.’

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 131

Regulation (EU) No 575/2013
Article 312

The own funds requirement for operational risk shall be the product of the business indicator component calculated in accordance with Article 313 and the internal loss multiplier calculated in accordance with Article 313a.

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
article 1 – paragraph 1 – point 131

Regulation (EU) No 575/2013
Article 313 a (new)

Article 313a Internal Loss Multiplier 1. Institutions shall calculate their internal loss multiplier component in accordance with the following formula: where ILM = the internal loss multiplier BI= the business indicator, expressed in billions of euro, calculated in accordance with Article 314; LC = the loss component, expressed in billions of euro, calculated as 15 times the annual average over the last ten financial years of the annual operational risk losses calculated in accordance with Articles 316 and 318 and Article 319(1). 2. When the business indicator of an institution exceeds 1 for the first time: (a) institutions that do not have ten years of good quality loss data may use a minimum of five years of data to calculate the loss component; (b) institutions that do not have five years of good-quality loss data shall set the internal loss multiplier at 1; (c) competent authorities may however require an institution to calculate the loss component using fewer than five years of losses if the resulting internal loss multiplier is greater than 1 and competent authorities believe the losses are representative of the institution’s operational risk exposure.’

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 131

Regulation (EU) No 575/2013
Article 317 ¬ paragraph 1

1. Institutions that calculate annual operational risk losses in accordance with Article 316(1) shall have in place arrangements, processes and mechanisms to inform and maintain updated on an ongoing basis a loss data set compiling for each recorded operational risk event the gross loss amounts, non-insurance recoveries, insurance recoveries, reference dates and grouped losses, including those from misconduct events. These arrangements, processes and mechanisms shall be internally reviewed before the use of the loss data set for the calculation of own funds requirements for operational risk.

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 131

Regulation (EU) No 575/2013
Article 322 ¬ paragraph 2

2. Competent authorities shall ~~periodically~~ review the quality of the loss data of an institution that calculates annual operational risk losses in accordance with Article 316(1). ~~Competent authorities shall carry out such review at least every three years for an institution with a business indicator above EUR 1 billion.~~

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 131

Regulation (EU) No 575/2013
Article 322 – paragraph 2 a (new)

2 a. Institutions that do not meet the requirements set out in Articles 316, 317, 318, 319, 320, and 321 shall apply an internal loss multiplier of at least 1 and competent authorities may require these institutions to apply an internal loss multiplier greater than 1.

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 156 – point a

Regulation (EU) No 575/2013
Article 325bg ¬ paragraph 3

3. For each position of a given trading desk, an institution's compliance with the P&L attribution requirement as referred in to paragraph 1 shall lead to the identification of a precise list of risk factors that are deemed appropriate for verifying the institution's compliance with the back-testing requirement set out in Article 325bf.;deleted

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 157 – point a

Regulation (EU) 575/2013
Article 325bh ¬ paragraph 1 – point i – introductory part

(i) for positions in CIUs, institutions shall look through the underlying positions of the CIUs at least on a weekly basis to calculate their own funds requirements in accordance with this Chapter~~; i~~. If an institution looks through less regularly than daily, it shall identify, measure and monitor any risk occurring from its less than daily look through and avoid any significant risk underestimation. Institutions that do not have adequate data inputs or information to calculate the own fund requirement for market risk of a CIU position in accordance with the look- through approach may rely on a third party to obtain those data inputs or information, provided that all the following conditions are met:

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 166 – point b

Regulation (EU) No 575/2013
Article 382 – paragraph 4

(b) ~~the following~~ paragraphs 4a and 4b are inserted: 4a. paragraph 4, an institution may choose to calculate an own funds requirements for CVA risk, using any of the applicable approaches referred to in Article 382a, for those transactions that are excluded in accordance with paragraph 4, where the institution uses eligible hedges determined in accordance with Article 386 to mitigate the CVA risk of those transactions. Institutions shall establish policies to specify where they choose to satisfy their own funds requirements for CVA risk for such transactions. 4b. competent authorities the results of the calculations of the own funds requirements for CVA risk for all the transactions referred to in paragraph 4. For the purposes of that reporting requirement, institutions shall calculate the own funds requirements for CVA risk using the relevant approaches set out in Article 382a(1), that they would have used to satisfy an own funds requirement for CVA risk if those transactions were not excluded from the scope in accordance with paragraph 4. is deleted; By way of derogation from Institutions shall report to their

2022/08/18
Committee: ECON

Marek BELKA, Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 172 a (new)

Regulation (EU) No 575/2013
Article 429a – paragraph 1 – point c a (new)

(172 a) in Article 429a(1), the following point is added: (ca) where the institution is a member of the network referred to in Article 113(7), the exposures that are assigned a risk weight of 0% in accordance with Article 114 and arising from assets being an equivalent of deposits in the same currency of other members of that network stemming from legal or statutory minimum deposit in accordance with Article 422(3), point (b). In such a case exposures of other members of that network being legal or statutory minimum deposit are not subject to point c).

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 182

Regulation (EU) 575/2013
Article 434 ¬ paragraph 1

1. Institutions other than small and non-complex institutions shall submit all the information required under Titles II and III in electronic format to EBA no later than the date on which institutions publish their financial statements or financial reports for the corresponding period, where applicable, or as soon as possible thereafter. EBA shall also publish the submission date of this information. EBA shall ensure that the disclosures made on the EBA website contain the information identical to what institutions submitted to EBA. Institutions shall have the right to resubmit to EBA the information in accordance with the technical standards referred to in Article 434a. EBA shall make available on its website the date when the resubmission took place. EBA shall prepare and keep up-to- date the tool that specifies the mapping of the templates and tables for disclosures with those on supervisory reporting. The mapping tool shall be accessible to the public on the EBA website. Institutions may continue to publish a standalone document that provides a readily accessible source of prudential information for users of that information or a distinctive section included in or appended to the institutions' financial statements or financial reports containing the required disclosures and being easily identifiable to those users. Institutions may include in their website a link to the EBA website where the prudential information is published on a centralised manner.

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 182

Regulation (EU) 575/2013
Article 434 ¬ paragraph 2

2. Large institutions and other institutions that are not large institutions or small and non-complex institutions shall submit to EBA the disclosures referred to in Article 433a and Article 433c respectively, 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 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.deleted

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 182

Regulation (EU) 575/2013
Article 434 ¬ paragraph 3

3. EBA shall publish on its website the disclosures of ~~small and non-complex~~ institutions on the basis of the information reported by those institutions to competent authorities in accordance with Article 430.

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 193

Regulation (EU) No 575/2013
Article 461a – introductory part

‘The Commission shall monitor the implementation of the international standards on own funds requirements for market risk in third countries. Where significant differences between the Union implementation and third countries’By 31 December 2025, the Commission shall submit a report to the European Parliament and to the Council, on the implementation of those international standards ~~are observed, including as regards the impact of the rules in terms of~~on own funds requirements ~~and as regards~~ for market risk in otheir ~~entry into appl~~jurisdication~~, the Commission shall be empowered to adopt~~s. This report may be accompanied by a deleg~~ated act~~islative proposal, inf a~~ccordance with Article 462 to amend this Regulation by:~~ppropriate, in order to ensure a global level playing field.

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 193

Regulation (EU) No 575/2013
Article 461a – point a

(a) applying, where necessary to deliver a level playing field, a multiplier equal to or greater than 0 and lower than 1 to the institutions’ own funds requirements for market risk, calculated for specific risk classes and specific risk factors using one of the approaches referred to indeleted Articles 325c to 325ay, specifying Articles 325(1), and laid out in: (i) the alternative standardised approach; (ii) the alternative internal model approach; (iii) simplified standardised approach, to offset those observed differences between the third countries rules and Union law;az to 325bp, specifying Articles 326 to 361, specifying the

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 193

Regulation (EU) No 575/2013
Article 461a – paragraph 1 – point b

(b) postponing by two years the date from which institutions shall apply the own funds requirements for market risk set out in Part Three, Title IV, or any of the approaches to calculate the own funds requirements for market risk referred to in Article 325(1).;deleted

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 196

Regulation (EU) 575/2013
Article 465 – paragraph 3

3. By way of derogation from Article 92(5)(a), point (i), parent institutions, parent financial holding companies or parent mixed financial holding companies, stand-alone institutions in the EU or stand-alone subsidiary institutions in Member States may, until 31 December2032, assign a risk weight of 65 % to exposures to corporates for which no credit assessment by a nominated ECAI is available provided that that entity estimates the PD of those exposures, calculated in accordance with Part Three, Title II, Chapter 3, is no higher than 0,5 %. EBA shall monitor the use of the transitional treatment laid down in the first subparagraph and the availability of credit assessments by nominated ECAIs for exposures to corporates. EBA shall report its findings to the Commission by 31 December 2028. On the basis of that report and taking due account of the related internationally agreed standards developed by the BCBS, the Commission shall, where appropriate, submit to the European Parliament and to the Council a legislative proposal by 31 December 2031.deleted

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 196

Regulation (EU) No 575/2013
Article 465 – paragraph 4

4. By way of derogation from Article 92(5)(a), point (iv), parent institutions, parent financial holding companies or parent mixed financial holding companies, stand-alone institutions in the EU or stand-alone subsidiary institutions in Member States shall, until 31 December 2029, replace alpha by 1 in the calculation of the exposure value for the contracts listed in Annex II in accordance with the approaches set out in Part Three, Title II, Chapter 6, Sections 3 and 4, where the same exposure values are calculated in accordance with the approach set out in Part Three, Title II, Chapter 3, Section 6 for the purposes of the total un-floored risk exposure amount. The Commission may, having taken into account the EBA report referred to in Article 514, adopt a delegated act in accordance with Article 462 to permanently modify the value of alpha, where appropriate.deleted

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 196

Regulation (EU) No 575/2013
Article 465 – paragraph 5

~~5. [...]~~deleted

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 199

Regulation (EU) No 575/2013
Article 495a – paragraph 3

3. By way of derogation from Article 133, institutions may continue to assign the same risk weight that was applicable as of [OP please insert the date = one day before the date of entry into force of this amending Regulation] to equity exposures to entities of which they have been a shareholder at [adoption date] for six consecutive years and over which they exercise significant influence in the meaning of Directive 2013/34/EU, or the accounting standards to which an institution is subject under Regulation (EC) No 1606/2002, or a similar relationship between any natural or legal person and an undertaking.deleted

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 199

Regulation (EU) No 575/2013
Article 495d – title

~~Article 495d Transitional arrangements for unconditional cancellable commitments~~deleted

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 199

Regulation (EU) No 575/2013
Article 495d – paragraph 1

1. By way of derogation from Article 111(2), institutions shall calculate the exposure value of an off-balance sheet item in the form of unconditionally cancellable commitment by multiplying the percentage provided for in that Article by the following factors: (a) January 2025 to 31 December 2029; (b) January 2030 to 31 December 2030; (c) January 2031 to 31 December 2031; (d) January 2032 to 31 December 2032.deleted 0 % during the period from 1 25 % during the period from 1 50 % during the period from 1 75 % during the period from 1

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 199

Regulation (EU) No 575/2013
Article 495d – paragraph 2

2. EBA shall prepare a report to assess whether the derogation referred to in paragraph 1, point (a), should be extended beyond 31 December 2032 and, where necessary, the conditions under which that derogation should be maintained. EBA shall submit the report on its finding to the European Parliament, to the Council, and to the Commission, by 31 December 2028. On the basis of that report and taking due account of the related internationally agreed standards developed by the BCBS, the Commission shall, where appropriate, submit to the European Parliament and to the Council a legislative proposal by 31 December 2031.’;deleted

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 200

Regulation (EU) No 575/2013
Article 501

(200) in Article 501~~(2), point (b) is replaced by the following: ‘(b) an SME shall have the meaning laid down in Article 5, point (8);’~~ is deleted;

2022/08/18
Committee: ECON

Danuta Maria HÜBNER

Proposal for a regulation
Article 1 – paragraph 1 – point 201 – introductory part

Regulation (EU) No 575/2013
Article 501a

(201) Article 501a~~(1)~~ is amended as follows: (a) point (a) is replaced by the following: ‘(a) the exposure is assigned to the corporate exposure class referred to either in Article 112, point (g), or in Article 147(2), point (c), with the exclusion of exposures in default;’; (b) point (f) is replaced by the following: ‘(f) the refinancing risk of the exposure by the obligor is low or adequately mitigated, taking into account any subsidies, grants or funding provided by one or more of the entities listed in paragraph 2, points (b)(i) and (b)(ii);’;deleted.

2022/08/18
Committee: ECON