UBI Banca Group

the prices approved become the reference used by the Credit Committee of the Parent and the
loan approval units of the individual banks and they must be given in all loan approval
proposals;
– appropriate operational and IT procedures are defined to implement the pricing framework.
Policy on risks resulting from securitisations
The “Policy on risks resulting from securitisations” sets guidelines for the Group to manage risks
relating to securitisations defined as “the risk that the underlying economic substance of a
securitisation is not fully reflected in decisions made to measure and manage risk”. This risk relates
to both conventional and synthetic securitisations originated by the Group which involve the transfer,
at least partial, of the risk attaching to the securitised assets.
The process of implementing a securitisation must involve stating the objective of the transaction and
the role played by the UBI Banca Group in it and verification that it is fully compliant with the
requirements contained in Bank of Italy Circular 263 “New regulations for the prudent supervision of
banks” of 27 th December 2006.
The UBI Group will make sole use of agencies recognised by the Bank of Italy (ECAI – External Credit
Assessment Institution) when assigning ratings to bonds and/or the tranches issued.
Policy on residual risk
The “Policy on residual risk” formulates strategic orientations relating to the management of “residual
risk”, defined as the risk of incurring losses resulting from the unforeseen ineffectiveness of
established methods of mitigating credit risk used by the UBI Group.
The policy contains a definition of the process of control over the acquisition and use of techniques to
reduce credit risk in order to mitigate that risk.
That process is centred on the definition of appropriate risk management processes designed firstly to
ensure the verification of compliance with supervisory regulations, distinguishing between:
“general requirements”, such as “legal certainty”, the “speed of implementation” and
“organisational requirements”;
“specific requirements”, with particular attention to revaluation and monitoring of collateral
and guarantees and verification of the absence of substantial correlation between the ability of
the debtor to repay and the collateral.
1.2.3 Techniques for mitigating credit risk
The Group employs standard risk mitigation techniques used in the banking sector by acquiring
security such as properties and financial instruments as well as personal guarantees from
counterparties for some types of loan. Determination of the total amount of credit that can be granted
to a given customer and/or group of companies to which the customer belongs takes account of
special criteria for assigning weightings to the different categories of risk and to guarantees. Prudent
"haircuts" are applied to the estimated value of collateral depending on the type of security.
The main types of security accepted by the Group are as follows:
- real estate mortgage
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