On Sep. 23, ESP CB announced decision to comply with guidelines.
ESP CB announced decision to comply with EBA/GL/2026/05 on definition of default.
Follows May 2026 EBA published final report amending Guidelines on application of the definition of default, following public consultation issued Jul. 2025, see #261017.
Overview
ESP CB Board adopted the Guidelines on Sep. 11, 2026, in its capacity of competent authority for direct supervision of less significant credit institutions (LSIs), the Official Credit Institute (ICO), and financial credit establishments.
Guidelines EBA/GL/2016/07 will apply to said entities as amended by EBA/GL/2026/05.
Recalls EBA published English version on May 7, 2026 and Spanish version on Jul. 17.
Key updates include a revision of technical past-due criterion specifically for factoring agreements where acquired receivables (invoices) are recorded on the entity’s balance sheet (non-recourse factoring).
In such cases, maturity threshold applied at invoice level is extended from 30 to 90 days to better reflect the economic reality of the acquired receivables.
Additionally, terminological adjustments and technical references align with changes introduced by CRR3 regarding the definition of default.
Finally, 1% materiality threshold based on reduction in net present value (NPV) is retained as criterion to identify refinanced/restructured exposures as being in default.
