80. Institutions should choose an appropriate approach between an approach based on overlapping and …

Institutions should choose an appropriate approach between an approach based on overlapping and an approach based on non-overlapping one-year time windows, to calculate the observed average default rate based on a documented analysis. This analysis should include at least the following:

• (a) an analysis of possible bias due to the proportion of short-term and terminated contracts that cannot be observed during the relevant one-year periods;
• (b) an analysis of possible bias due to the specific calculation dates chosen;
• (c) for institutions using overlapping one-year time windows, an analysis of potentially significant bias due to implicit over-weighting of the overlapping time period;
• (d) an analysis of potentially significant bias due to seasonal effect related to the chosen calculation dates.

1. Forbhreathnú

1.1 Tagairtí

1.2 Ceanglais aitheanta

1.3 Caighdeáin ghaolmhara

2. Ceanglais aitheanta

3. Caighdeáin ghaolmhara

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