(ii) Weights for risk indicators and categories

The DGS should assign weights to all risk indicators in the method for calculating contributions so that their sum equals 100%.

When assigning weights to particular risk indicators, the DGS should assign at least the minimum weights to the risk categories and the core risk indicators, as specified in Table 2.

Table 2: Minimum weights for the risk categories and the core risk indicators

Risk categories and core risk indicators Minimum weights

1. Capital 20% 1.1. Leverage ratio 10% 1.2. CET1 ratio or CCR 10% 2. Liquidity and funding 15% 2.1. LCR 5% 2.2. NSFR 10% 3. Asset quality 12.5% 3.1. NPL ratio 12.5% 4. Business model and management 15% 4.1. TREA / Total assets 5% 4.2. RoA 10% 5. Potential losses for the DGS 12.5% 5.1. Covered deposits / Unencumbered assets 12.5% Sum 75%

The sum of the minimum weights specified in these Guidelines for the risk categories and the core risk indicators amounts to 75% of total weights. The DGS should distribute the remaining 25% among the risk categories laid down in paragraph 29.

The DGS should allocate the flexible 25% of weights by distributing them among the additional risk indicators and/or by increasing the minimum weights of the core risk indicators. The weight of any indicator should not be higher than 25%.

Where a core indicator is not used, the DGS should assign the remaining core indicator from the same risk category the full minimum weight for this risk category.

Where there is only one core indicator in a category, and this core indicator is not used, the DGS should replace it by a proxy with the same minimum weight as the core indicator.

For any risk indicator, the DGS should assign it one weight and apply that same weight for all member institutions.