On October 31, 2014, the EBA issued a consultation paper on draft RTS on the materiality threshold of credit obligations past due under the CRR. The EBA is proposing an absolute materiality threshold, as well as a relative materiality threshold. The absolute threshold would relate to the credit obligation past due for more than 90 or 180 days (depending on the decision of the national regulator), and the relative threshold would relate to a percentage of the total credit obligation that is past due. A default would be deemed to have occurred when both of these limits are breached. The objective of the thresholds is to promote consistency in assessing bad debts across the EU.

The consultation closes on January 31, 2015. The consultation paper is available at: http://www.eba.europa.eu/documents/10180/878549/EBA-CP-2014-32+%28CP+on+RTS+on+Past+Due+Materiality+Threshold%29.pdf.