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Version status: Applicable | Document consolidation status: Updated to reflect all known changes
Version date: 1 January 2014 - 27 June 2021
  Version 4 of 5  

Article 452 Use of the IRB Approach to credit risk

Institutions calculating the risk-weighted exposure amounts under the IRB Approach shall disclose the following information:

(a) the competent authority's permission of the approach or approved transition;

(b) an explanation and review of:

(i) the structure of internal rating systems and relation between internal and external ratings;

(ii) the use of internal estimates other than for calculating risk-weighted exposure amounts in accordance with Part Three, Title II, Chapter 3;

(iii) the process for managing and recognising credit risk mitigation;

(iv) the control mechanisms for rating systems including a description of independence, accountability, and rating systems review;

(c) a description of the internal ratings process, provided separately for the following exposure classes:

(i) central governments and central banks;

(ii) institutions;

(iii) corporate, including SMEs, specialised lending and purchased corporate receivables;

(iv) retail, for each of the categories of exposures to w