S.L. 371.17 Art. 5AExposures secured by mortgages on immovable property (Loss Given Default values).

In terms of Article 4(2) of the Act, the competent authority shall, at least annually, and jointly with the Central Bank, assess whether the minimum Loss Given Default (LGD), as referred to in paragraph 4 of Article 164 of the CRR, are appropriate for exposures secured by mortgages on residential property or commercial immovable property located in Malta. Where the competent authority, jointly with the Central Bank, conclude that such minimum LGD values are not adequate and could adversely affect Malta’s current or future financial stability, the competent authority, jointly with the Central Bank, may set higher minimum LGD values for those exposures located in Malta. Such higher minimum LGD values may also be applied at the level of one or more property segments of such exposures.