With reference to EBA Q&A 677, Q&A 1968 and Implementing Act 2016/230/EU EBA, Q&A 677 states the following:

"Exposures to a recognised exchange, as defined in point 72 of Article 4(1) of Regulation (EU) No 575/2013 (CRR) are not automatically treated as exposures to institutions. For an exposure to a recognised exchange to be treated as an exposure to an institution certain conditions need to be met”. It continues to say that if those “… conditions are not met, then the exposure to the recognised exchange must be treated as an exposure to a corporate."

No regulatory reference was provided to support the last statement/conclusion, 'If the above conditions are not met, then the exposure to the recognised exchange must be treated as an exposure to a corporate'. It is unclear what is meant by 'treated as an exposure to a corporate'. Does this mean the exposure class changes from institution to corporate or does it mean the exposure class remains an institution but uses corporate exposure risk weights in Article 122 of the CRR. in Addition, EBA Q&A 1968 does not confirm the correct own funds treatment for non-equivalent third country institutions and investment firms.