13. For the purpose of quantifying LGDs that are appropriate for an economic downturn, institutions should apply all definitions and all requirements set out in Section 4, Section 6, Section 7, Section 8 and Section 9 of the EBA Guidelines on PD estimation, LGD estimation and the treatment of defaulted exposures (EBA/GL/2017/16) of 20/11/2017 (EBA GL on PD and LGD estimation) that are relevant for this purpose.

14. In addition to paragraph 13, for the purpose of quantifying downturn LGD institutions should apply the following requirements specific to downturn LGD estimates by facility grade or pool:

(a) calibrate downturn LGD at least at the same level at which institutions calculate the corresponding long-run average LGD for the purpose of calibrating LGD in accordance with paragraph 161 of the [EBA GL on PD and LGD estimation].