Regulation on emerging markets and advanced economies

This regulation establishes technical standards to determine which countries are classified as emerging markets or advanced economies. This classification is crucial for calculating the risk weights of assets held by banks, ensuring that financial institutions maintain appropriate capital buffers based on the economic stability of the regions where they invest.

This primarily affects banks and financial supervisors. It changes how credit risk is assessed for exposures to different countries, potentially impacting the amount of capital banks must hold against their international investments.