Article 495(3) of the Capital Requirements Regulation empowers the European Commission to adopt, following submission of draft standards by the European Banking Authority, delegated acts specifying the conditions for affording the exemption from the internal ratings-based (IRB) treatment of certain categories of equity exposures.
The Commission has now published the Delegated Regulation that it has adopted on regulatory technical standards for the transitional treatment of equity exposures under the IRB approach. The delegated act establishes only one condition for the purpose of granting the exemption of IRB treatment for equity exposures. More specifically, it provides that Member State competent authorities may afford to institutions and EU subsidiaries of institutions the exemption from the IRB treatment only with regard to those categories of their equity exposures that on 31 December 2013 were already benefiting from an exemption from the IRB treatment.
The Delegated Regulation enters into force on the twentieth day following that of its publication in the Official Journal of the EU. The Delegated Regulation is directly applicable in all Member States.
