Question ID:
2017_3096
Legal Act:
Directive 2014/49/EU (DGSD)
Topic:
Funding provisions (financing means, use of funds, borrowing, calculation of contributions)
Article:
13
COM Delegated or Implementing Acts/RTS/ITS/GLs:
EBA/GL/2015/10 - Guidelines on methods for calculating contributions to deposit guarantee schemes
Article/Paragraph:
58
Type of submitter:
Deposit Guarantee scheme
Subject Matter:
Risk weights for the core indicator set
Question:

EBA/GL/2015/10 Article 58, bullet point 2 suggests that there is no flexibility of the risk weights when the core risk indicator set are applied (with no additional indicators or any indicators left out). Would it be in compliance with the guidelines to use the core indicator set but to distribute the 25 % flexible weights somewhat different than what article 58, bullet point 2 suggests?

Background on the question:

We would prefer to use the core indicator set unchanged as defined in the guidelines, but would also like to increase the weighting of the risk category 5 «potential losses for the DGS» more than the other categories (of course within the 15 percentage points increase limit for an indicator as specified in article 58, bullet point 3). The purpose is to put more emphasis on the potential loss for the DGS, compared to the other risk categories that predicts the level of distress among the member institutions. Within the guidelines there is great flexibility of choosing additional risk indicators and risk weights above the minimum weights. However, article 58, bullet point 2 suggests that there is no flexibility of the risk weights when only the core risk indicator set are applied.

Date of submission:
12/01/2017
Published as Final Q&A:
20/12/2019
EBA Answer:

According to the EBA/GL/2015/10 (Guidelines on methods for calculating contributions to deposit guarantee schemes), paragraph 58, bullet point 2, where only core risk indicators are used in the calculation method, the allocation of the risk weights to each risk category is clearly specified. The Guidelines do not allow flexibility where only core indicators are used. Due to the clear wording of the Guidelines, using risk-weights differing from the ones specified in paragraph 58, bullet point 2, would constitute non-compliance with the Guidelines.

Status:
Final Q&A