AI Summary of Article 117 Exposures to multilateral development banks
The regulatory framework assigns specific risk weights to exposures involving multilateral development banks (MDBs), as delineated in the referenced guidelines. Exposures to MDBs not listed in Paragraph 2 with an available credit assessment by a nominated External Credit Assessment Institution (ECAI) will receive risk weights according to their credit quality, ranging from 20% to 150% as outlined in Table 1. Conversely, exposures lacking such assessments will default to a 50% risk weight.
Notably, certain MDBs, including the International Bank for Reconstruction and Development and the European Investment Bank, are designated for a 0% risk weight, indicating their low risk profile. The Commission retains authority to amend this regulation, ensuring alignment with evolving international standards.
Article 117 Exposures to multilateral development banks
1. Exposures to multilateral development banks that are not referred to in paragraph 2 and for which a credit assessment by a nominated ECAI is available shall be assigned a risk weight in accordance with Table 1. Exposures to multilateral development banks that are not referred to in paragraph 2 for which a credit assessment by a nominated ECAI is not available shall be assigned a risk weight of 50 %.
Table 1
|
Credit quality step |
1 |
2 |
3 |
4 |
5 |
6 |
|---|---|---|---|---|---|---|
|
Risk weight |
20 % |
30 % |
50 % |
100 % |
100 % |
150 % |
The Inter-American Investment Corporation, the Black Sea Trade and Development Bank, the Central American Bank for Economic Integration and the CAF-Development Bank of Latin America shall be considered multilateral development banks.
2. Exposures to the following multilateral development banks shall be assigned a 0 % risk weight:
(a) the International Bank for Reconstruction and Development;