The EBA published its final Guidelines (GL) regarding the types of exposures to be associated with high risk under the Capital Requirements Regulation (CRR). The GL, which should be implemented by 1 July 2019, consist of two sections. The first one clarifies the notions of investments in venture capital firms and private equity, which the EBA has taken the initiative to provide for the purpose of these Guidelines only. This step was triggered by the lack of guidance available to the public on these notions and because definitions are deemed necessary to ensure harmonization on the types of exposures that are considered as investments in venture capital firms and private equity. The second section specifies the types of exposures listed under Article 128 (3) of the CRR, which should be considered as high risk and provides stakeholders with a clear identification scheme to follow in their process of identification of exposures associated with high risk. This guidance will encourage institutions to single out and specify those individual exposures that carry a high risk of loss as items of particularly high risk and, therefore, structurally different from common exposures of the same original asset class.

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