Regulatory Technical Standards on the method for the identification of the geographical location of the relevant credit exposures

Under the capital requirements rules in the EU, institutions at Member State level are required to hold countercyclical buffers (CCB) to protect the banking system against potential losses when excess credit growth is associated with an increase in system wide risks. The size of countercyclical buffers will depend on the countercyclical buffer rates set by national authorities and the portfolio distribution of the institutions. In particular, the buffers to be held by individual institutions with cross-border activities will depend on the geographical location of their credit portfolios and not on the location of the institutions that hold these exposures. These Regulatory Technical Standards aim at setting out criteria for identifying the geographical location of all relevant credit exposures, namely credit risk, trading book and securitisation exposures.