1. When assessing the adequacy of the process of updating the institution’s trading limits referred to in Article 103(2), points (b)(ii), Article 104b(2), points (c) and (f), and Article 325bi(1), point (b), of Regulation (EU) No 575/2013, competent authorities shall verify whether:
the update process is coordinated and duly documented by the risk control unit;
the proposal for updating the trading limits reflects any changes in:(i)the acceptable level of risk set by the institution;(ii)the expected activity or in the budget objectives of the trading desks;
the acceptable level of risk set by the institution;
the expected activity or in the budget objectives of the trading desks;
the proposal for updating the trading limits takes into account, over the period where the trading limit applicable at the time of the update has been used:(i)the average level of use of the trading limits applicable at the time of the update;(ii)the number and magnitude of trading limit breaches.
the average level of use of the trading limits applicable at the time of the update;
the number and magnitude of trading limit breaches.
2. Competent authorities shall verify whether the process to update trading limits is conducted at least every year, and more frequently where there are changes in the organisation or new business lines or products are introduced.