in force 2025-01-01 MODIFIED+1,142 −454§
Amended by Regulation (EU) 2024/1623 32024R1623 · Regulation (EU) 2024/2987 32024R2987 · Regulation (EU) 2024/2795 32024R2795
applies from: unchanged
The provision now opens with a new paragraph -1 assigning risk weights to exposures to regional governments or local authorities based on a nominated ECAI credit assessment using a table linked to Article 136, whereas the prior version had no such credit-assessment-based table and instead risk-weighted these exposures as exposures to institutions.
Paragraph 1 is rewritten so that exposures without a nominated ECAI credit assessment are risk-weighted according to a second table tied to the credit quality step of the relevant central government, including a stated 100% weight where that central government is unrated, replacing the earlier rule that simply treated such exposures as exposures to institutions unless treated as central government exposures or given the paragraph 5 weight.
Paragraphs 2, 4 and 5 now state they apply by way of derogation from paragraphs -1 and 1, paragraph 3 refers to legal acts rather than legislation conferring taxing rights and drops the reference to Article 150(1)(a) permission, and paragraph 5's cross-reference is expanded to paragraphs 2, 3 and 4 instead of paragraphs 2 to 4.
Cited: Art. 115, v2 · Art. 115, v1
text before / after
02013R0575-20240709 → 02013R0575-20250101
Article 115
Exposures to regional governments or local authorities
-1. Exposures to regional governments or local authorities for which a credit assessment by a nominated ECAI is available shall be assigned a risk weight in accordance with Table 1 which corresponds to the credit assessment of the ECAI in accordance with Article 136.
Table 1
Credit quality step 1 2 3 4 5 6
Risk weight 20 % 50 % 50 % 100 % 100 % 150 %
1. Exposures to regional governments or local authorities for which a credit assessment by a nominated ECAI is not available shall be risk-weighted as exposures to institutions unless they are treated as exposures to central governments under paragraphs 2 or 4 or receive assigned a risk weight as specified in paragraph 5. The preferential treatment for short-term accordance with the credit quality step to which exposures specified to the central government of the jurisdiction in Article 119(2) which regional governments or local authorities are incorporated are assigned in accordance with Table 2.
Table 2
Credit quality step 1 2 3 4 5 6
Risk weight 20 % 50 % 100 % 100 % 100 % 150 %
For exposures referred to in the first subparagraph, a risk weight of 100 % shall be assigned where the central government of the jurisdiction in which regional governments or local authorities are incorporated is unrated.
2. By way of derogation from paragraphs - 1 and Article 120(2) shall not be applied.
2. Exposures 1, exposures to regional governments or local authorities shall be treated as exposures to the central government in whose jurisdiction they are established where there is no difference in risk between such exposures because of the specific revenue-raising powers of the former, and the existence of specific institutional arrangements the effect of which is to reduce their risk of default.
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 governments.
3. Exposures to churches or religious communities constituted in the form of a legal person under public law shall, in so far as they raise taxes in accordance with legislation legal acts conferring on them the right to do so, be treated as exposures to regional governments and local authorities. In this that case, paragraph 2 shall not apply and, for the purposes apply.
4. By way of Article 150(1)(a), permission to apply the Standardised Approach shall not be excluded.
4. When derogation from paragraphs - 1 and 1, where competent authorities of a third country jurisdiction third-country which applies supervisory and regulatory arrangements at least equivalent to those applied in the Union treat exposures to regional governments or local authorities as exposures to their central government and there is no difference in risk between such exposures because of the specific revenue-raising powers of regional government or local authorities and to specific institutional arrangements to reduce the risk of default, institutions may risk weight exposures to such regional governments and local authorities in the same manner.
For the purposes of this paragraph, the Commission may adopt, by way of implementing acts, and subject to the examination procedure referred to in Article 464(2), a decision as to whether a third country applies supervisory and regulatory arrangements at least equivalent to those applied in the Union. In the absence of such a decision, until 1 January 2015, institutions may continue to apply the treatment set out in this paragraph to the third country where the relevant competent authorities had approved the third country as eligible for that treatment before 1 January 2014.
5. Exposures By way of derogation from paragraphs - 1 and 1, exposures to regional governments or local authorities of the Member States that are not referred to in paragraphs 2 to 2, 3 and 4 and are denominated and funded in the domestic currency of that regional government and or local authority shall be assigned a risk weight of 20 %.