ESAs consult to amend technical standards on the mapping of ECAIs’ credit assessments

The JC of the ESAs has initiated a consultation to propose amendments to the ITS on the mapping between relevant credit assessments of ECAIs and CQS for credit risk. The objective is to ensure a consistent and robust regulatory framework across the EU in the banking and insurance sectors.
The proposed amendments are based on a monitoring exercise conducted to assess the adequacy of existing mappings (eventid=13110). These include changes to the credit quality steps allocation for four ECAIs, the introduction of new credit rating scales for seven ECAIs, and the withdrawal of registration for one ECAI – as quoted:
– Removal from the mapping table of the CRA that has lost ECAI status following its deregistration as a CRA under the CRA Regulation, and reflection of name changes of two registered entities.
– Amendments due to the re-allocation of CQS (EthiFinance ratings S.A., Creditreform Ratings AG, ICAP CRIF S.A., Nordic Credit Rating AS) and amendments due to new or amended credit rating scales (ARC Ratings S.A., Banque de France, Bulgarian Credit Rating Agency (BCRA), EthiFinance ratings S.A., Kroll Bond Ratings Agency, Qivalio SAS and Scope Ratings GmbH).
The ITS, adopted in October 2016, establish the mapping between credit ratings and CQS defined in the CRR and Solvency II Directive.
The proposed revisions to the ITS are developed in accordance with the relevant articles of the CRR and Solvency II Directive, which mandate the ESAs to submit revised draft ITS when necessary. This is the fourth amendment proposed by the ESAs, following previous amendments made in June 2021 and adopted by the EC in November 2021. The previous amendments included changes to mappings, registration of new ECAIs, and updates to credit rating scales.
The ESAs have also published individual draft mapping reports, providing insights into the methodology applied and explaining the amended mappings in line with the CRR mandate.