A stable, well-functioning financial market for allA stable, well-functioning financial market for allFI reciprocates the extension of Norwegian risk weight floors
Finansinspektionen (FI) has passed a decision to reciprocate the Norwegian Ministry of Finance’s decision to extend average risk weight floors of 20 per cent for retail exposures collateralised by real estate in Norway and of 35 per cent for corporate exposures collateralised by real estate in Norway.
Through national measures pursuant to Article 458 of the supervisory regulation, Norway has since 2020 introduced risk weight floors for real estate exposures in Norway. The Norwegian Ministry of Finance has decided to extend the risk weight floors until 31 December 2024.The risk weight floors applies for institutions that are authorized to use an internal ratings-based approach for the calculation of their capital requirements for credit risks.
FI will apply the threshold of NOK 32.3 billion for retail exposures collateralised by real estate and NOK 7.6 billion for corporate exposures collateralised by real estate, as stated by the Norwegian Ministry of Finance.
FI:s decision means that Swedish credit institutions with permission to use the internal ratings-based approach, and which have exposures in Norway that exceed the specified thresholds, are covered by the Norwegian risk weight floors.
FI:s decision applies from the 31st of March 2023 to the 31st of December 2024.
