EBA publishes final RTS for operational risk loss under CRR3

The European Banking Authority (EBA) has published a final report containing three final draft regulatory technical standards (RTS) aimed at standardising the collection and recording of operational risk losses under the Capital Requirements Regulation (CRR) as amended by the CRR3. The RTS also clarify exemptions for the calculation of the annual operational risk loss and on the adjustments to loss data sets that banks must perform in case of merged or acquired entities or activities. The draft RTS were previously consulted on in June 2024.

The final report consists of the following:

• Final draft RTS on establishing a risk taxonomy on operational risk that complies with international standards and a methodology to classify the loss events included in the loss data set based on that risk taxonomy on operational risk under Article 317(9) of the CRR.
• Final draft RTS on the conditions under which it would be unduly burdensome for an institution to calculate the annual operational risk loss under Article 316(3) of the CRR. In such cases, the draft RTS allow for a temporary waiver from the requirement to calculate the annual operational risk loss.
• Final draft RTS on the adjustments to an institution's loss data set following the inclusion of losses from merged or acquired entities or activities, providing indications on the currency and the risk taxonomy to be used when incorporating the loss data set of merged entities or activities, and providing guidance on how to calculate the annual operational risk loss when data on historical issues are not available.

The final draft RTS will be submitted to the European Commission for endorsement following which they will be scrutinised by the European Parliament and the Council of the EU before being published in the Official Journal of the European Union.

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