Or. en Justification Since the ultimate repayment source is represented by the guarantor of the exposure, it is the PD but also the LGD estimates of this guarantor that reflect the risk of the bank that ultimately is incurred.
It is consequently suggested to add after §9 the provisions applicable to undrawn credit lines : possibility to use a credit conversion factor of 0% and possibility for the establishments to estimate credit conversion factors (see § 11 (a) and (d)).