Version detected , Modified +4 −3§
no amending act named
Explanation, written by a model and checked against the cited text
The only textual change is a grammatical correction in the opening sentence, from "An institution that use" to "An institution that uses".
Cited: Art. 372, v1 (external, EUR-Lex) · Art. 372, v2 (external, EUR-Lex)
v1 is the previous version, v2 this one.
Text from EUR-Lex, before and after
Previous version 32013R0575 → this version, detected 13 August 2026 02013R0575-20130628
Article 372
Requirement to have an internal IRC model
An institution that use uses an internal model for calculating own funds requirements for specific risk of traded debt instruments shall also have an internal incremental default and migration risk (IRC) model in place to capture the default and migration risks of its trading book positions that are incremental to the risks captured by the value-at-risk measure as specified in Article 365(1). The institution shall demonstrate that its internal model meets the following standards under the assumption of a constant level of risk, and adjusted where appropriate to reflect the impact of liquidity, concentrations, hedging and optionality:
(a) the internal model provides a meaningful differentiation of risk and accurate and consistent estimates of incremental default and migration risk;
(b) the internal model's estimates for potential losses play an essential role in the risk management of the institution;
(c) the market and position data used for the internal model are up-to-date and subject to an appropriate quality assessment;
(d) the requirements in Article 367(3), Article 368, Article 369(1) and points (b), (c), (e) and (f) of Article 370 are met.
EBA shall issue guidelines on the requirements in Articles 373 to 376.