(2)In order to also account for the possibility that the COVID-19 pandemic might result in an increase in the levels of defaulted exposures across credit institutions, it is desirable to remove any regulatory impediments to the creation of secondary markets for defaulted exposures. It is therefore necessary to ensure that the specific credit risk adjustments recognised for the purposes of Article 127(1) of Regulation (EU) No 575/2013 incorporate any discount in a transaction price of a defaulted exposure that the purchasing institution has not recognised by increasing Common Equity Tier 1 capital. In particular, in order to avoid any undue double recognition of the potential decrease in the level of expected loss by the purchasing institution after the purchase on both Common Equity Tier 1 capital of that institution and for the purposes of determining the risk weight in accordance with Article 127(1) of Regulation (EU) No 575/2013, in case of a revaluation of the defaulted exposure occurring after its purchase, the discount should no longer incorporate the part of the revaluation amount of the defaulted exposure that has been recognised as increasing the institution’s Common Equity Tier 1 capital.