107. Credit institutions should consider in particular the following non-exhaustive list of …

Credit institutions should consider in particular the following non-exhaustive list of indicators in assessing a significant increase in credit risk:

• a. a decision by the credit institution’s senior management such that, if an existing lending exposure were newly originated at the reporting date, the element of the price of the lending exposure that reflects the credit risk of the exposure would be significantly higher than it was when the loan was actually originated, because of an increase in the credit risk of the specific borrower or class of borrowers since inception;
• b. a decision by the credit institution’s senior management to strengthen collateral and/or covenant requirements for new lending exposures that are similar to lending exposures already originated, because of changes in the credit risk of those exposures since initial recognition;
• c. a downgrade of a borrower by a recognised credit rating agency, or within a credit institution’s internal credit rating system;
• d. for performing lending exposures subject to individual monitoring and review, an internal credit assessment summary/credit-quality indicator that is weaker than upon initial recognition;
• e. deterioration of relevant determinants of credit risk (e.g. future cash flows) for an individual obligor (or pool of obligors); and
• f. expectation of modification due to financial difficulties, including those qualifying as forbearance in accordance with Regulation (EU) 2015/227.

While implementation of IFRS 9 should reflect credit risk management practices where possible, in some cases that would not be appropriate. If, for example, a credit institution manages most lending exposures in the same way regardless of credit risk — with the exception only of particularly strong or weak credits — the manner in which a lending exposure is managed is unlikely to be a sound indicator of whether there has been a significant increase in credit risk.

1. Forbhreathnú

1.1 Tagairtí

1.2 Ceanglais aitheanta

1.3 Caighdeáin ghaolmhara

2. Ceanglais aitheanta

3. Caighdeáin ghaolmhara

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