The benchmark referred to in point (c) of Article 136(2) of Regulation (EU) No 575/2013, shall be distinguished in:

1. (a)

   a long-run default rate benchmark for each credit quality step as set out in Table 1 of Annex I;

2. (b)

   a short-run default rate benchmark for each credit quality step as set out in Table 2 of Annex I.

The reference meaning of a rating category that corresponds to each credit quality step is set out in Annex II.