188. For the purposes of justifying situations where the specific credit risk adjustments exceed …

For the purposes of justifying situations where the specific credit risk adjustments exceed the EL BE estimates in accordance with Article 54(2)(f) of the RTS on IRB assessment methodology, institutions should ensure consistency of the EL BE estimates with the economic loss components described in section 6.3.1 as well as with the definition of default set out in Article 178 of Regulation (EU) No 575/2013 and analyse any differences in that regard from the definitions and methods used for the purpose of determining specific credit risk adjustments. In particular, institutions should take into account, the possible differences in the discounting rate, the presence of collateral that is not eligible under Article 181(1)(f) of Regulation (EU) No 575/2013, different treatments of costs and the application of different definitions of default.

7.3.3 Specific requirements for LGD in-default estimation

1. Overview

1.1 References

• Article 178 Default of an obligor or credit facility

1.2 Identified Requirements

1.3 Related Standards

2. Identified Requirements

3. Related Standards

• EBA - Published by the European Banking Authority at https://www.eba.europa.eu/