(133)

Articles 500 and 501 are replaced by the following: ‘Article 500 Adjustment for massive disposals 1. By way of derogation from point (a) of Article 181(1), an institution may adjust its LGD estimates by partly or fully offsetting the effect of massive disposals of defaulted exposures on realised LGDs up to the difference between the average estimated LGDs for comparable exposures in default that have not been finally liquidated and the average realised LGDs including on the basis of the losses realised due to massive disposals, as soon as all the following conditions are met: The adjustment referred to in the first subparagraph may only be carried out until 28 June 2022 and its effects may last for as long as the corresponding exposures are included in the institution's own LGD estimates. 2. Institutions shall notify the competent authority without delay when the condition set out in point (c) of paragraph 1 has been met. Article 501 Adjustment of risk-weighted non-defaulted SME exposures 1. Institutions shall adjust the risk-weighted exposure amounts for non-defaulted exposures to an SME (RWEA), which are calculated in accordance with Chapter 2 or 3 of Title II of Part Three, as applicable, in accordance with the following formula: where: 2. For the purposes of this Article: (*17) Commission Recommendation 2003/361/EC of 6 May 2003 concerning the definition of micro, small and medium-sized enterprises (OJ L 124, 20.5.2003, p. 36).’;" the institution has notified the competent authority of a plan providing the scale, composition and the dates of the disposals of defaulted exposures; the dates of the disposals of defaulted exposures are after 23 November 2016 but not later than 28 June 2022; the cumulative amount of defaulted exposures disposed of since the date of the first disposal in accordance with the plan referred to in point (a) has surpassed 20 % of the cumulative amount of all observed defaults as of the date of the first disposal referred to in points (a) and (b). RWEA* | = | the RWEA adjusted by an SME supporting factor; and E* | = | the total amount owed to the institution, its subsidiaries, its parent undertakings and other subsidiaries of those parent undertakings, including any exposure in default, but excluding claims or contingent claims secured on residential property collateral, by the SME or the group of connected clients of the SME. the exposure to an SME shall be included either in the retail or in the corporates or secured by mortgages on immovable property classes; an SME is defined in accordance with Commission Recommendation 2003/361/EC (*17); among the criteria listed in Article 2 of the Annex to that Recommendation only the annual turnover shall be taken into account; institutions shall take reasonable steps to correctly determine E* and obtain the information required under point (b).

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Source: EUR-Lex (Cellar) · retrieved 2026-10-12 · Text as adopted (Official Journal); later amendments are not incorporated in this text.