Regulatory Alerts2026-05-07
Danish Financial Supervisory Authority extends transitional arrangement for credit ratings
The Danish Financial Supervisory Authority extends its transitional arrangement, permitting External Credit Assessment Institutions (ECAIs) to continue using credit ratings that assume implicit state support until 1 January 2027. This extension leverages Article 495e of CRR III, which empowers national regulators to allow such ratings until 31 December 2029, and aligns Danish implementation with broader European developments. The adjustment specifically applies to risk-weighting calculations under the standard approach for credit risk, temporarily preserving a methodology initially abolished under the CRR III framework.
Sector News 07-05-2026 The option to use credit ratings that include expected state support is extended until 1 January 2027. The Danish Financial Supervisory Authority (Finanstilsynet) is extending the transitional arrangement, which allows External Credit Assessment Institutions (ECAIs) to use credit ratings that assume implicit state support (expectation of state support if the company were to encounter difficulties). This applies to credit ratings used for risk weighting under the standard approach for credit risk.
The option was initially abolished as part of CRR III. However, Article 495e allows competent authorities – in Denmark, the Danish Financial Supervisory Authority – to permit ECAIs to use credit ratings with implicit state support during a transitional period until 31 December 2029.
The Danish Financial Supervisory Authority has previously allowed the use of credit ratings during a transitional period until 30 June 2026. This option is now extended until 1 January 2027 to reflect developments in Europe.
The Danish Financial Supervisory Authority publishes the use of options in CRR III here
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Anders Fuglsig Larsen Senior Consultant
Email: anfl@ftnet.dk
Tel: +45 33 55 83 55
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