CP13/6 - CRD IV for Investment Firms - Financial Conduct Authority

FCA 2013/xx
126(2), 178(1)(b), 243(2), 244(2), 286(2), 298(4) and 380 of the EU
CRR; and
(3) contains the guidance in relation to the IRB approach, securitisation,
counterparty credit risk and credit risk mitigation.
4.2 Standardised approach
Standardised approach
4.2.1 R For the purposes of article 115 of the EU CRR (Exposures to regional
governments or local authorities), a firm may treat exposures to the following
regional governments as exposures to central government:
(a)
(b)
(c)
The Scottish Parliament;
The National Assembly for Wales; and
The Northern Ireland Assembly.
Risk weights
4.2.2 G Where the FCA has published evidence showing that a well-developed and
long-established residential property market is present in that territory with
loss rates which do not exceed the limits in article 125(3) of the EU CRR
(Exposures fully and completely secured by mortgages on residential
property), a firm does not need to meet the condition in article 125(2)(b) of
the EU CRR in order to consider an exposure, or any part of an exposure, as
fully and completely secured for the purposes of article 125(1) of the EU
CRR.
Criteria for certain exposures secured by mortgages on commercial immovable
property
4.2.3 R For the purposes of articles 124(2) and 126(2) of the EU CRR and in addition
to the conditions in those regulations, a firm may only treat exposures as fully
and completely secured by mortgages on commercial immovable property in
line with article 126 where annual average losses stemming from lending
secured by mortgages on commercial property in the UK did not exceed 0.5%
of risk-weighted exposure amounts over a representative period. The loss
level in this rule shall be the aggregate market data for commercial property
lending published by the FCA in line with article 101(3) of the EU CRR.
4.2.4 R For the purpose of this rule, a representative period shall be a time horizon of
sufficient length and which includes a mix of good and bad years.
Exposures to institutions
4.2.5 G The FCA confirms that there are no financial institutions currently authorised
and supervised by it that are subject to prudential requirements that it
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