IRB reliance peaks at over 90% for some lenders ahead of Basel III shift
As reforms loom, IRB usage spans from marginal to near-total among European banks
Nykredit, Nordea and ING Bank rank as the most reliant on internal credit risk modelling among banks in jurisdictions preparing to implement Basel III reforms at the start of 2025. The new rules introduce significant constraints on the use of internal ratings-based (IRB) approaches.
As of end-September, the three lenders applied foundation (F-IRB) or advanced IRB (A-IRB) approaches to calculate 93%, 90.9% and 88% of their respective credit risk-weighted assets (RWAs), the highest proportions
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