Article 123 | CRR | Regulation 575/2013

Article 123 - Retail exposures

Article 123

Exposures that comply with the following criteria shall be assigned a risk weight of 75 %:

(a)

the exposure shall be either to a natural person or persons, or to a small or medium-sized enterprise (SME);

(b)

the exposure shall be one of a significant number of exposures with similar characteristics such that the risks associated with such lending are substantially reduced;

(c)

the total amount owed to the institution and parent undertakings and its subsidiaries, including any exposure in default, by the obligor client or group of connected clients, but excluding exposures fully and completely secured on residential property collateral that have been assigned to the exposure class laid down in point (i) of Article 112, shall not, to the knowledge of the institution, exceed EUR 1 million. The institution shall take reasonable steps to acquire this knowledge.

Securities shall not be eligible for the retail exposure class.

Exposures that do not comply with the criteria referred to in points (a) to (c) of the first subparagraph shall not be eligible for the retail exposures class.

The present value of retail minimum lease payments is eligible for the retail exposure class.

Exposures due to loans granted by a credit institution to pensioners or employees with a permanent contract against the unconditional transfer of part of the borrower's pension or salary to that credit institution shall be assigned a risk weight of 35 %, provided that all the following conditions are met:

(a)

in order to repay the loan, the borrower unconditionally authorises the pension fund or employer to make direct payments to the credit institution by deducting the monthly payments on the loan from the borrower's monthly pension or salary;

(b)

the risks of death, inability to work, unemployment or reduction of the net monthly pension or salary of the borrower are properly covered through an insurance policy underwritten by the borrower to the benefit of the credit institution;

(c)

the monthly payments to be made by the borrower on all loans that meet the conditions set out in points (a) and (b) do not in aggregate exceed 20 % of the borrower's net monthly pension or salary;

(d)

the maximum original maturity of the loan is equal to or less than ten years.

PART ONE - GENERAL PROVISIONS (Article 1-24)

PART TWO - OWN FUNDS AND ELIGIBLE LIABILITIES (Article 25-91)

PART THREE - CAPITAL REQUIREMENTS (Article 92-386)

TITLE I - GENERAL REQUIREMENTS, VALUATION AND REPORTING (Article 92-106)

TITLE II - CAPITAL REQUIREMENTS FOR CREDIT RISK (Article 107-311)

CHAPTER 1 - General principles (Article 107-110)

CHAPTER 2 - Standardised approach (Article 111-141)

Section 1 - General principles (Article 111-113)

Section 2 - Risk weights (Article 114-134)Article 114 - Exposures to central governments or central banks IAQ&A Article 115 - Exposures to regional governments or local authorities RTSIAQ&AGL Article 116 - Exposures to public sector entities RTSIAQ&A Article 117 - Exposures to multilateral development banks Q&A Article 118 - Exposures to international organisations Q&A Article 119 - Exposures to institutions Q&A Article 120 - Exposures to rated institutions Q&A Article 121 - Exposures to unrated institutions Q&A Article 122 - Exposures to corporates Q&A Article 123 - Retail exposures Q&A Article 124 - Exposures secured by mortgages on immovable property RTSQ&A Article 125 - Exposures fully and completely secured by mortgages on residential property RTSQ&A Article 126 - Exposures fully and completely secured by mortgages on commercial immovable property RTSQ&A Article 127 - Exposures in default RTSQ&AGL Article 128 - Items associated with particular high risk Q&AGL Article 129 - Exposures in the form of covered bonds Q&AGL Article 130 - Items representing securitisation positions Article 131 - Exposures to institutions and corporates with a short-term credit assessment Q&A Article 132 - Own funds requirements for exposures in the form of units or shares in CIUs Q&A Article 132a - Approaches for calculating risk-weighted exposure amounts of CIUs RTSQ&A Article 132b - Exclusions from the approaches for calculating risk-weighted exposure amounts of CIUs Article 132c - Treatment of off-balance-sheet exposures to CIUs Q&A Article 133 - Equity exposures Q&A Article 134 - Other items Q&A

Section 3 - Recognition and mapping of credit risk assessment (Article 135-137)

Section 4 - Use of the ECAI credit assessments for the determination of risk weights (Article 138-141)

CHAPTER 3 - Internal Ratings Based Approach (Article 142-191)

CHAPTER 4 - Credit risk mitigation (Article 192-241)

CHAPTER 5 - Securitisation (Article 242-270e)

CHAPTER 6 - Counterparty credit risk (Article 271-311)

TITLE III - OWN FUNDS REQUIREMENTS FOR OPERATIONAL RISK (Article 312-324)

TITLE IV - OWN FUNDS REQUIREMENTS FOR MARKET RISK (Article 325-377)

TITLE V - OWN FUNDS REQUIREMENTS FOR SETTLEMENT RISK (Article 378-380)

TITLE VI - OWN FUNDS REQUIREMENTS FOR CREDIT VALUATION ADJUSTMENT RISK (Article 381-386)

PART FOUR - LARGE EXPOSURES (Article 387-403)

PART FIVE - EXPOSURES TO TRANSFERRED CREDIT RISK (Article 404-410)

PART SIX - LIQUIDITY (Article 411-428az)

PART SEVEN - LEVERAGE (Article 429-429g)

PART SEVEN A - REPORTING REQUIREMENTS (Article 430-430c)

PART EIGHT - DISCLOSURE BY INSTITUTIONS (Article 431-455)

PART NINE - DELEGATED AND IMPLEMENTING ACTS (Article 456-464)

PART TEN - TRANSITIONAL PROVISIONS, REPORTS, REVIEWS AND AMENDMENTS (Article 465-520)

PART ELEVEN - FINAL PROVISIONS (Article 521)

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Article 123 - Retail exposures

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