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1 min readWarningEBA reporting framework 4.2Updated 10 November 2026

Arithmetic average PD cannot be more than 1 (C 08.05.1.a, EBA rule v09766_m)

A warning in the own funds and capital requirements return (COREP own funds), on template C 08.05.1.a, credit risk and free deliveries: IRB approach to capital requirements: back-testing of PD in accordance with Article 180(1), point (f) of Regulation (EU) No 575/2013 (CR IRB 5B) (I).

Check your file against this ruleWhat to do if it fails

The rule in plain words

Arithmetic average PD (%) cannot be more than 1.

How the Line4 Check report words itShow

Word for word as the report shows it when the rule fails.

Arithmetic average PD (%): Arithmetic average PD (%) <= 1

What to do if your filing fails it

  1. 01Open the template below and find the cells the rule reads.
  2. 02Look for a value outside the limit in these cells.
  3. 03If the value is a percentage, EBA expects it as a decimal: 12% is reported as 0.12.
  4. 04EBA compares the values exactly here: there is no rounding tolerance.
  5. 05It runs only when your filing indicators mark C 08.05.1 as reported.
  6. 06This is a warning. It does not stop the filing on its own, but your authority may ask you to explain it.

The cells it reads

Credit risk and free deliveries: IRB approach to capital requirements: back-testing of PD in accordance with Article 180(1), point (f) of Regulation (EU) No 575/2013 (CR IRB 5B) (I) (C 08.05.1.a)

Column

  • 0010Arithmetic average PD (%)

A worked example

The first of its checks, with simple numbers.

What the rule then expects

Arithmetic average PD (%) can then be at most 1.

1Passes
1.1Fails

A file that reports 1 passes. One that reports 1.1 fails, by 0.1.

The numbers are illustrative.

Show the rule as writtenShow

EBA's formula. Cells are written as {template, row, column, sheet}.

{C_08.05.1.a,,c0010,} <= 1

Every COREP own funds rule, by template

Checks like this one, run at the point of submission, are the first step to real-time supervision.