Question ID: 1698
Regulation Reference: (EU) No 2015/35 - supplementing Dir 2009/138/EC - taking up & pursuit of the business of Insurance and Reinsurance (SII)
Article: 180
Status: Revised
Date of submission: 09 Oct 2018
Question
Is IDA (International Development Association, member of the World Bank Group) to be assigned a 0% risk weight for Solvency 2?
There are three World Bank entities that issue AAA/Aaa bonds, IBRD, IFC and IDA.
IBRD and IFC are already recognised under Solvency 2 as being assigned a 0% risk weight by reference to Regulation 575/2013. On 30 November 2016 the Basel Committee added IDA to the list of 0% risk weighted entities under Basel, (https://www.bis.org/publ/bcbs_nl19.htm).
Is IDA also 0%?
EIOPA answer
The answer to this question has been revised due to change in the regulation.
Article 180 Par. 2 (c) of the Delegated Regulation sets out a zero risk charge for the multilateral development banks listed in paragraph 2 of Article 117 of Regulation (EU) No 575/2013. REGULATION (EU) 2019/876 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 20 May 2019 added the International Development Association (IDA) to this list in 2019. As a result exposures in the form of bonds and loans to the IDA should be assigned a risk factor stress i of 0 % in the calculation of the capital requirement for spread risk on bonds and loans.