To qualify for a 75% risk weight in the regulatory retail portfolio, claims must meet the four criteria stated in the Credit Risk Standard (orientation criterion, product criterion, granularity criterion and value criterion). All other retail claims should be risk weighted at 100%. For granularity criterion and value criterion, the aggregated exposure means gross amount (i.e. not taking any credit risk mitigation into account) of all forms of retail exposures, excluding residential real estate exposures. In case of off-balance sheet items, the gross amount will be calculated after applying credit conversion factors. In addition, “to one counterparty” means one or several entities that may be considered as a single beneficiary (e.g. in the case of a small business that is affiliated to another small business, the limit would apply to the bank’s aggregated exposure on both businesses).

24.Claims secured by residential property and past due retail loans are to be excluded from the overall regulatory retail portfolio for risk weighting purposes. These are addressed separately in the asset classes for residential property or commercial real estate.