On 22 May 2018, the European Banking Authority (EBA) published two consultation papers on draft regulatory technical standards (RTS) specifying an economic downturn and on a set of guidelines related to the estimation of loss given default (LGD) appropriate for conditions of an economic downturn. The draft RTS specify the nature, severity and duration of an economic downturn, while the guidelines focus on the appropriate estimation of the LGD in a situation of economic downturn. Both consultations are part of the EBA’s broader review of the internal ratings-based approach which aims to reduce the unjustified variability in the outcomes of internal models, while preserving the risk sensitivity of capital requirements. The deadline for comments on both consultation papers is 22 June 2018.