Recital 1

(1)To ensure a level playing field among institutions in the Union and to minimise regulatory arbitrage, the methodologies for developing extreme scenarios of future shock for non-modellable risk factors should be based on the international standards agreed in January 2019 by the Basel Committee on Banking Supervision (BCBS) (Basel framework), and should take into account the materiality of the own funds requirements for non-modellable risk factors. Therefore, specific and detailed methodologies for developing extreme scenarios of future shock for non-modellable risk factors should be laid down.