Home   Browse contents   View updates   Search  
     Quick search

Dubai Financial Services Authority (DFSA): Contents

Dubai Financial Services Authority (DFSA)
Recognised Jurisdictions and Funds
Declaration Notices
Financial Markets Tribunal
Rulebook Modules
Prudential — Investment, Insurance Intermediation and Banking Module (PIB) [VER34/12-19]
PIB App4 Credit Risk
Sourcebook Modules
Consultation Papers
Policy Statements
DFSA Codes of Practice
Amendments to Legislation
Media Releases

Whole SectionText only Print Print Manager Link

(1 version)
Dec 9 2012 onwards

PIB A4.11.1

View whole sectionWhole Section PDF

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.

An Authorised FirmG may treat the following ExposuresG as exempt from the Concentration RiskG limits in PIB chapter 4 if they are to CounterpartiesG not ConnectedG to the Authorised FirmG :

(a) asset items or ExposuresG constituting claims on central governments and Central BanksG which receive a Credit Quality GradeG rating 1 or 2 in accordance with PIB Rule 4.12.4;
(b) asset items or ExposuresG constituting claims on international organisations and multi-lateral development banks (MDBs) which receive a 0% (Credit Quality GradeG rating of 1) risk weight as set out at PIB Rule 4.12.7;
(c) asset items or ExposuresG carrying the explicit guarantees of either (a) or (b) where the claims on the entity providing the guarantee would receive a 0% weighting (Credit Quality GradeG rating of 1);
(d) ExposuresG for which the Authorised FirmG has CollateralG in the form of cash deposits or certificates of deposit, including certificates of deposit issued by the Authorised FirmG , held by the Authorised FirmG , or held by the Authorised Firm'sG ParentG Regulated Financial InstitutionG or a SubsidiaryG of the Authorised FirmG , but only if:
(i) the Authorised FirmG and its ParentG Regulated Financial InstitutionG or the SubsidiaryG of the Authorised FirmG concerned are subject to consolidated supervision; and
(ii) the enforceability requirements in PIB section 4.13 (Credit RiskG mitigation) are met;
(e) ExposuresG arising from undrawn credit facilities that are classified as low risk off balance sheet items and provided that an agreement has been concluded with the client or group of ConnectedG clients under which the facility can only be drawn only if it has been ascertained that it will not cause the limit as set out in PIB Rule 4.15.5 to be exceeded;
(f) ExposuresG secured by mortgages on residential property and leasing transactions under which the lessor retains full ownership of the residential property leased for as long as the lessee has not exercised his option to purchase, in all cases up to 50% of the value of the residential property concerned; and
(g) material holdings in Regulated Financial InstitutionsG and other ExposuresG which have been deducted from an Authorised Firm'sG Capital ResourcesG as required in PIB chapter 3.
Derived from RM111/2012 (Made 15th October 2012). [VER20/12-12]