Is “separately rated” in Article 172(1)(d) to be interpreted as “rated on individual information” or as ”having own rating based on a separate rating process”? Alternatively put: How is “separately rated” in Article 172(1)(d) to be interpreted?
The background to the question is to understand whether subsidiaries have to be rated based on individual information (e g capital ratio and market share) or if they can be rated based on their interconnection with the parent company (e.g. committed parental support and subsidiary's importance in group) and the parent company's rating, as long as the subsidiary has an own rating and an own rating process to achieve it according to the bank’s internal policy.
Please note that as part of adjustments to the Single Rulebook Q&A process, agreed by the EBA and the European Commission, it has been decided to reject outstanding questions submitted before 1 January 2020, when the Q&A process was updated as part of the last ESAs Review. In particular, the question that you have submitted has now regrettably been rejected and will not be addressed.
If you believe your question would still benefit from clarification, you are invited to resubmit your question, adapting it to reflect any legislative, regulatory or other relevant developments that may have occurred since the initial date of submission. The EBA will aim to address resubmitted questions as a matter of priority. When considering to resubmit, you are kindly requested to observe the updated admissibility criteria agreed in the context of the adjustment of the Q&A process, available in the Additional background and guidance for asking questions. We hope for your understanding.
For further information please refer to the press release and the updated Q&A page.