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IFR 5.4.7

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The definitive version of DFSA handbook text is the PDF version as that is the text of the instrument as made and published by the DFSA.

To view past versions of this module in PDF format, please visit the Archive.

(1) In this section:
(a) "E" represents the ExposureG determined by an Authorised FirmG as applicable to an Islamic ContractG ; and
(b) "CRW represents the risk weighting or capital charge assessed by an Authorised FirmG as appropriate to that Islamic ContractG .
(2) Where an Islamic ContractG is in the Non-Trading BookG , an Authorised FirmG must determine the PSIACOMcredit for that contract by applying the following formula:
E × CRW × 8%.
(3) Where an Islamic ContractG is in the Trading BookG , an Authorised FirmG must determine the PSIACOMcredit for that contract in accordance with the methodology in PIB A4.7 and PIB A4.8 as appropriate.
(4) An Authorised FirmG must calculate its PSIACOMcredit of all contracts by:
(a) identifying all Islamic ContractsG to which this section applies;
(b) valuing the underlying investment or asset of each contract and reducing the value of any such investment or asset in the manner stipulated in Section 4.9 of chapter 4 of PIB, the result of which constitutes E for that contract;
(c) determining the risk weighting or capital charge appropriate to each contract, which will constitute the CRW for that contract in accordance with Rules in Sections 4.10, 4.11 and 4.12 of chapter 4 of PIB;
(d) applying the respective formula in IFR Rule 5.4.7(2) or (3) to determine of PSIACOMcredit in respect of each contract; and
(e) summing the PSIACOMcredit of each contract to determine the PSIACOMcredit applicable to the Authorised FirmG .
Derived from DFSA RM69/2010 (Made 1st March 2010). [VER1/03-10]
[Amended] DFSA RM115/2012 (Made 15th October 2012). [VER5/12-12]
[Amended] DFSA RM210/2017 (Made 25 October 2017). [VER12/01-18]