Article 8
Exemption
In cases where there is limited quantitative evidence to support the predictive power of a credit rating methodology, a credit rating agency shall be exempt from complying with Article 7 of this Regulation if it:
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(a) |
ensures that credit rating methodologies are sensible predictors of credit worthiness; |
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(b) |
applies internal procedures in a consistent way and over time and across different market segments; |
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(c) |
has processes in place to ensure that systemic credit rating anomalies highlighted by back-testing are identified and are appropriately addressed. |