Source: European Parliament
Ensuring the level playing both inside the single market and vis-à-vis third countries is one of the core tasks of Commission. The approach contained in Article 116 of Regulation (EU) No 575/2013 (Capital Requirements Regulation)[1] is in line with this objective, by granting the same prudential treatment to banks exposures that present equivalent risks.
To achieve this objective, the Commission cannot disregard the competences — recognised by the Treaties — of Member States in setting-up and delivering their national health systems. These differ significantly in terms of governance and funding arrangements and, accordingly, credit risk profile.
Given their knowledge of their domestic healthcare bodies and other public sector entities (PSE), national competent authorities are better suited to assess the risks which each PSE poses. As such, they are tasked by the Capital Requirements Regulation with assessing whether exposures to PSEs can be considered as bearing the same risks of exposures to the central government, regional government, or local authority of their respective Member States.
As noted in the answer to Written Question E-002729/2024[2] from the Honourable Member, the merits of this approach have been confirmed recently by co-legislators when endorsing Regulation (EU) 2024/1623[3], which — to increase transparency of the single-market — tasks the European Banking Authority to establish and update a publicly accessible database of PSEs within the EU which are treated as the central, regional or local government of the Member State in which they are established for the purposes of prudential capital requirements.
- [1] OJ L 176, 27.6.2013, p. 1-337.
- [2] https://www.europarl.europa.eu/doceo/document/E-10-2024-002729-ASW_EN.html
- [3] Regulation (EU) 2024/1623 of the European Parliament and of the Council of 31 May 2024 amending Regulation (EU) No 575/2013 as regards requirements for credit risk, credit valuation adjustment risk, operational risk, market risk and the output floor, OJ L, 2024/1623, 19.6.2024.