79. Competent authorities should use this preliminary assessment to: a. determine the materiality …

Competent authorities should use this preliminary assessment to:

a. determine the materiality of business activities: competent authorities should determine which geographies, subsidiaries/branches, activities, and where relevant business lines or product lines are the most material based on profit contribution (notably based on P&L), risk (including K-factors or other measures of risk) and/or organisational priorities. Competent authorities should use this information as a basis for identifying what the BMA should focus on (as covered further in Section 4.3;
b. identify the peer group: competent authorities may determine (i) the relevant peer group for the investment firm on the basis of its structure and activities; (ii) to conduct a BMA, the peer group on the basis of the rival product/business lines targeting the same source of profits/customers;
c. support the application of the principle of proportionality: competent authorities may use the outcomes of the preliminary assessment to help determine the appropriate granularity of assessment.

1. Overview

Summary	Regulation

Requirements
Source	Requirement

Standards
Source	Requirement

EBA -
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