Glossary

Calendar provisioning

Calendar provisioning is a primary-ranking regulation of bank capital requirements, by which the minimum levels of prudential provisioning to be held by banks for each individual impaired position are determined.

Central Credit Register

The Central Credit Register (CCR) is a database that gives an overview of household and business debts to the banking and financial system. It serves customers who have a good “credit history” to obtain financing more easily and on better terms. It is used by banks and finance companies to assess customers’ ability to repay their loans.

Default, new definition

The European Banking Authority (EBA) has introduced new rules for the default classification of defaulted counterparties. The new rules provide a stricter definition of the amount of arrears and meet the regulator’s goal of harmonising the definition of default among European financial institutions. As of 1 January 2021, AMCO will apply the new European rules on the classification of defaulted customers (so-called ‘default’) introduced by the European Banking Authority with the aim of standardising the behaviour of credit institutions among different countries in the European Union.

Direct GHG emissions (Scope 1)

Carbon footprint (also called GHG inventory, i.e., of GreenHouse Gas), is a measure that expresses in CO2 equivalent the total greenhouse gas emissions directly associated with a product, organisation or service.

Indirect GHG emissions from energy consumption (Scope 2)

These are the emissions resulting from the generation of purchased or acquired electricity, heating, cooling and steam consumed by an organisation.

Other indirect GHG emissions (Scope 3)

These are the indirect emissions not included in indirect GHG emissions from energy consumption (Scope 2) that occur outside the organisation, including upstream and downstream emissions.

ESG

Acronym used to indicate the areas of environmental, social and governance sustainability.

Mortgage loan

A mortgage loan is a medium- to long-term loan, typically lasting from 5 to 30 years. The customer usually receives the entire sum in one lump sum and repays it overtime in instalments of consultant or variable amounts. It is used to purchase, particularly a home. It can also be used to replace or refinance mortgages already obtained for the same purposes. It is called “mortgage” because the payment of instalments is secured by a mortgage on a property. It can be granted by banks and other financial operators, which we call all “intermediaries” in this Guide.

NPE

Non-performing exposures or impaired exposures. These are banks’ loans that borrowers can no longer pay regularly or at all. They are divided into non-performing loans or NPLs, probable defaults or UTPs and past due exposures or Past Due.

NPL

Non-performing loans, assets that can no longer repay principal and interest owed to creditors.

Sustainable Development Goals (SDGs)

These are the Sustainable Development Goals promoted by the United Nations as part of the 2030 Agenda for Sustainable Development: an action plan for people, planet and prosperity signed in September 2015 by the governments of the 193 UN member states.

UTP

Acronym for Unlikely to Pay. They are probable defaults by borrowers against banks, which have lent them money. UTPs are loans for which the banks are unlikely to see repayment because the creditors show some difficulty in paying scheduled instalments and interest. In this situation, creditors are not yet definable as insolvent.