May 2, 2024 (NO COMMENTS)

Unclear instructions, late guidance and poor font choices among reasons behind diverging interpretations from EBA’s template

 

A new metric introduced in the European Union to assess the amount of a bank’s assets included in the computation of the green asset ratio (GAR) was calculated in four different ways across 22 EU dealers analysed by Risk Quantum, with only nine using the correct formula. The GAR coverage ratio, defined as the proportion of total assets covered by the key performance indicators for the GAR, is calculated by dividing the assets included in the GAR denominator by a firm’s total assets.