2.2 Scope of application

These guidelines apply in relation to the IRB approach in accordance with Part Three, Title II, Chapter 3 of Regulation (EU) No 575/2013 and, in particular, to institutions that have been permitted to use own LGD estimates in accordance with Article 143 of that Regulation.

In particular, these guidelines specify the recognition of unfunded credit protection (defined in Article 4(1)(59) of Regulation (EU) No 575/2013) in accordance with Article 160(5), Article 161(3), Article 163(4), Article 164(2) and Article 183 of that Regulation as well as the recognition of funded credit protection (defined in Article 4(1)(58) of that Regulation) in accordance with Articles 166 and 181 of that Regulation.