European Banking Authority Consults on Technical Standards on Indirect Exposures

The European Banking Authority has opened a consultation on proposed draft Regulatory Technical Standards on the determination of indirect exposures to clients of derivative and credit derivative contracts underlying a debt or equity instrument for large exposures purposes. The EU Capital Requirements Regulation, as amended by CRR 2, requires firms to add to the total exposures to a client the exposures arising from derivative contracts listed in Annex II of the CRR and credit derivative contracts, where the contract was not directly entered into with that client but the underlying debt or equity instrument was issued by that client. The proposed draft RTS set out how firms should determine exposures arising from derivative and credit derivative contracts not entered directly into with a client but whose underlying debt or equity instrument was issued by a client. The consultation closes on October 23, 2020.

View the EBA's consultation paper.

View details of CRR 2.

Return to main website.