385. Competent authorities should determine P2G as specified in this section, and, where the determination leads to a positive value, they should set P2G to address supervisory concerns about the sensitivity of the institution to the adverse scenarios used in the supervisory stress tests.
386. Where the quantitative outcomes of the supervisory stress tests suggest that the institution is not expected to breach its TSCR under the adverse stress test scenario, competent authorities may decide not to set P2G.
387. Competent authorities should determine and set P2G based on the outcomes of the adverse scenario of the relevant supervisory stress tests, including the EU-wide stress tests performed by the EBA or any other relevant supervisory stress tests performed on a system-wide basis using a multi-factor scenario analysis over a forward-looking horizon of at least two years (either top-down or bottom-up).
388. On the basis of establishing a proportionate approach for non-Category 1 instit
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