EBA published a revised Decision confirming the quality of unsolicited credit assessments assigned by certain External Credit Assessment Institutions (ECAIs) for calculating capital requirements of institutions. Since the last EBA Decision published in July 2017, two additional ECAIs have been recognized and three ECAIs have been de-registered or de-certified while a registered ECAI has been renamed. The revised Decision has been amended to reflect these developments and is based on a quantitative and qualitative analysis. This Decision shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union. The Annex to the revised Decision lists ECAIs the unsolicited credit assessments of which EBA has confirmed do not differ in quality from their solicited credit assessments.
The revised Decision is part of the Single Rulebook in banking and will ensure regulatory harmonization across EU regarding the use of unsolicited credit ratings for determining institutions' own funds requirements. EBA Decision has been developed on the basis of Article 138 of the Capital Requirements Regulation (CRR), which establishes that institutions may use unsolicited credit assessments of an ECAI for the determination of capital requirements only if EBA has confirmed that those unsolicited ratings do not differ in quality from solicited ratings of that ECAI. EBA shall refuse or revoke the confirmation if an ECAI has used an unsolicited credit assessment to put pressure on the rated entity to place an order for a credit assessment or other services.
Effective Date: OJ+20 Days
Keywords: Europe, EU, Banking, ECAI, Credit Ratings, Regulatory Capital, Credit Assessment, CRR, Basel, EBA
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