RTS for prudent valuation under Regulation (EU) No 575/2013

This regulation establishes technical standards for 'prudent valuation,' which is a method banks use to ensure their assets are not overvalued on their balance sheets. By applying these cautious valuation rules, the EU aims to prevent banks from hiding losses and to ensure financial stability across the banking sector.

This affects credit institutions and investment firms. It changes how they calculate the value of financial instruments, requiring them to account for potential price drops and market volatility.