14. For the purposes of paragraph 2, point (h)(iii), competent authorities may, on a sample of non-modellable risk factors or non-modellable standardised buckets:
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(a)
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require the institution to generate a time series of returns from a fat-tailed statistical distribution prescribed by the competent authority and calculate the extreme scenario of future shock with the stepwise method referred to in Article 3 and Article 6 of Delegated Regulation (EU) 2024/397 combined with the historical method referred to in Article 8 of that Delegated Regulation;
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(b)
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verify the conservativeness of the institution’s expert-based approach by comparing the regulatory extreme scenario of future shock resulting from that approach with the extreme scenario of future shock calculated in accordance with point (a).
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