EBA publishes list of public sector entitles for the calculation of capital requirements

Date: 19 January 2017

On 18th November, the European Banking Authority (EBA) published the list of public sector entities (PSEs) that may be treated as regional governments, local authorities or central governments in the area of credit risk, in accordance with the Capital Requirements Regulation (CRR). This list will assist EU institutions in determining their capital requirements for credit risk.

The EBA has compiled this list on its own initiative to enhance harmonisation in the treatment of exposures to EU public sector entities (PSEs) using the standardised approach (SA) to capital requirements. In particular, the list includes those PSEs that are treated as regional governments, local authorities or central governments due to their reduced risk level. As a result of this treatment, exposures to the PSEs included in the list will qualify for the same risk weight as for the respective regional government, local authority or central government.

The list was compiled using the information provided by the Competent Authorities and is based on the classification used in each individual country. Hence the differences in the approaches and eligibility criteria for PSEs across countries.