Srl.
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Data
Element
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Harmonised
Definition
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1
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Consumer Credit
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Consumer credit refers to the
loans given to individuals, which consists of (a) loans for consumer
durables, (b) credit card receivables, (c) auto loans (other than loans
for commercial use), (d) personal loans secured by gold, gold jewellery,
immovable property, fixed deposits (including FCNR(B)), shares and bonds,
etc., (other than for business / commercial purposes), (e) personal loans
to professionals (excluding loans for business purposes), and (f) loans
given for other consumptions purposes (e.g., social ceremonies, etc.).
However, it excludes (a) education loans, (b) loans given for creation/
enhancement of immovable assets (e.g., housing, etc.), (c) loans given
for investment in financial assets (shares, debentures, etc.), and (d)
consumption loans given to farmers under KCC. For risk weighting purposes
under the Capital Adequacy Framework, the extant regulatory guidelines
will be applicable.
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2
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Personal loans
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Personal loans refers to loans
given to individuals and consist of (a) consumer credit, (b) education
loan, (c) loans given for creation/ enhancement of immovable assets
(e.g., housing, etc.), and (d) loans given for investment in financial
assets (shares, debentures, etc.).
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3
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Funded Credit
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Funded credit implies amount
actually lent or credited to a borrower's account or debited to
borrower's loan/ cash credit/ overdraft or any other borrowing account
for payment on behalf of the borrower.
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4
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Weighted Average Lending Rate
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Weighted average lending rate
(WALR) relates to all types of rupee credit accounts (viz., cash credit,
demand loans, overdrafts, inland bills financed and discounted, term
loans and other types, if any). The amount of loans under each credit
account is multiplied with its corresponding interest rates (usually, it
is done individual account-wise under each type of credit account) and
then, added together. This sum of all products is then divided by the
total amount of loans to arrive at WALR.
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5
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Pre-shipment Credit
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Pre-shipment credit means any
loan or advance granted or any other credit provided by a bank to an
exporter for financing the purchase, processing, manufacturing or packing
of goods prior to shipment / working capital expenses towards rendering
of services on the basis of letter of credit opened in his favour or in
favour of some other person, by an overseas buyer or a confirmed and
irrevocable order for the export of goods / services from India or any
other evidence of an order for export from India having been placed on
the exporter or some other person, unless lodgement of export orders or
letter of credit with the bank has been waived.
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6
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Take-out Finance/ Conditional
Take-out Finance
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Take-out finance is an
arrangement where an institution / bank, financing infrastructure
projects, will have an arrangement with any financial institution for
transferring to the latter, the outstanding in respect of such financing
in their books on a pre-determined basis. Conditional take-out finance:
In this scenario, the taking over institution would have stipulated
certain conditions to be satisfied by the borrower before it is taken
over from the lending institution.
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7
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Unsecured Guarantees
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Unsecured guarantees are those
which are not secured by any collateral. Limit on the amount of unsecured
guarantees is fixed by a bank's board.
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8
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Slippage
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Slippage refers to new
accretion to NPAs during a period.
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9
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Standard Advances
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Standard advance is an advance
which is not non-performing as per extant IRAC and provisioning norms.
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10
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Substandard Advances
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A substandard advance is one,
which remains non-performing for a period less than or equal to 12
months.
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11
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Doubtful Advances
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An advance which remains in
the substandard category for a period of 12 months.
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12
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Restructured Accounts
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A restructured account is one
where the bank, for economic or legal reasons relating to the borrower's
financial difficulty, grants to the borrower, concessions that the bank
would not otherwise consider. Restructuring would normally involve
modification of terms of the advances / securities, which would generally
include, among others, alteration of repayment period / repayable amount/
the amount of instalments / rate of interest (due to reasons other than
competitive reasons). However, extension in repayment tenure of a
floating rate loan on reset of interest rate, so as to keep the equated
monthly instalment (EMI) unchanged, provided it is applied to a class of
accounts uniformly, will not render the account to be classified as
‘Restructured account’. In other words, extension or deferment of EMIs to
individual borrowers as against to an entire class, would render the
accounts to be classified as 'restructured accounts’.
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13
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Restructured Standard Advances
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Restructured standard advances
are the advances restructured/ permitted to be classified as standard, as
per extant DBR instructions.
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14
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Mortgage-backed Security
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A Mortgage-backed security is
a bond-type security in which the collateral is provided by a pool of
mortgages. Income from the underlying mortgages is used to meet interest
and principal repayments.
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15
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Treasury Bills
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Treasury bills are short term
negotiable non-coupon bearing instruments issued by the Government of
India.
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16
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Shifted Investments
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Shifted investments are amount
of investments shifted from/to one category to another, among the three
categories i.e. held to maturity (HTM), available for sale (AFS), and
held for trading (HFT).
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17
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Equities Participations
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Equities participations refer
to the bank's investment in equities of subsidiary / associate / joint
venture either in India or abroad or equity participation in other
entities.
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18
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Securities Held for Trade
(HFT), Available for Sale (AFS), Held to Maturity (HTM)
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Held for Trading (HFT)
Securities: The securities acquired by the banks with the intention to
trade by taking advantage of the short-term price / interest rate
movements. These securities are to be sold within 90 days. Held to
maturity (HTM) Securities: The securities acquired by the banks with the
intention to hold them up to maturity. Available for Sale (AFS)
Securities: Securities not classified under HFT and HTM are included
under AFS.
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19
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Adjusted Net Bank Credit
(ANBC)
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ANBC denotes the outstanding
Bank Credit in India [As prescribed in item No.VI of Form ‘A’ under
Section 42 (2) of the RBI Act, 1934] minus bills rediscounted with RBI
and other approved Financial Institutions plus permitted non SLR
bonds/debentures under Held to Maturity (HTM) category plus other
investments eligible to be treated as part of priority sector lending
(e.g. investments in securitised assets). The outstanding deposits under
RIDF and other funds with NABARD, NHB, SIDBI and MUDRA Ltd. in lieu of
non-achievement of priority sector lending targets/sub-targets will form
part of ANBC. Advances extended in India against the incremental FCNR
(B)/NRE deposits, qualifying for exemption from CRR/SLR requirements, as
per the Reserve Bank’s circulars DBOD.No.Ret.BC.36/12.01.001/2013-14
dated August 14, 2013 read with DBOD.No.Ret.BC.93/12.01.001/2013-14
dated January 31, 2014 and DBOD mailbox clarification issued on
February 6, 2014 will be excluded from the ANBC for computation of
priority sector lending targets, till their repayment. The eligible
amount for exemption on account of issuance of long-term bonds for
infrastructure and affordable housing as per Reserve Bank’s circular
DBOD.BP.BC.No.25/08.12.014/2014-15 dated July 15, 2014 will also be
excluded from the ANBC for computation of priority sector lending
targets.
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20
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Inside Liabilities
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Inside liabilities are
capital, reserves and risk provisions.
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21
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Outside Liabilities
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Outside liabilities are
liabilities excluding capital, reserves and risk provisions.
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22
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Risk Sensitive Liabilities
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Liabilities which are
sensitive to market risks.
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23
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Assigned Capital
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Indian banks operating abroad
through branches, assign a specific amount as assigned capital for the
overseas branches. This assigned capital is reflected as assigned capital
in the overseas branch ledger and reported to DSB (overseas returns)
submitted by such banks.
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24
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Perpetual Non- Cumulative
Preference Shares
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Perpetual non-cumulative
preference shares refer to preference shares which are eligible for
inclusion in additional Tier I capital subject to prescribed guidelines.
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25
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Disclosed Reserve
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Disclosed reserves refer to
the appropriations of profit after tax to specific categories of reserves
which are required to be disclosed in Schedule 2 of the published balance
sheet as per provisions of the Banking Regulation Act 1949 and regulatory
instructions.
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26
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Regulatory Capital
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Regulatory capital means total
of tier I and tier II capital calculated as per extant instructions on
capital adequacy.
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27
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Capital Conservation Buffer
(CCB)
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Capital conservation buffer
refers to capital buffer, comprising of common equity tier I capital,
which banks are required to maintain above the regulatory minimum capital
requirement of 9% under part - D of master circular - Basel III
capital regulations - DBR.No.BP.BC.1/21.06.201/2015-16 dated 01-07-2015.
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28
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Horizontal Disallowance
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A disallowance of offsets to
required capital using the BIS Method for assessing market risk for
regulatory capital. In order to calculate the capital required for
interest rate risk of a trading portfolio, the BIS Method allows offsets
of long and short positions. Yet, interest rate risk of instruments at
different horizontal points of the yield curve are not perfectly
correlated. Hence, the BIS Method requires that a portion of these
offsets be disallowed.
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29
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Vertical Disallowance
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In the BIS method for
determining regulatory capital, necessary to cushion market risk, a
reversal of the offsets of a general risk charge of a long position by a
short position in each currency in two or more securities in the same
time band in the yield curve where the securities have differing credit
risks.
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30
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Collateralised Borrowing and
Lending Obligation (CBLO)
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The Clearing Corporation of
India Ltd. (CCIL) has developed and introduced, with effect from January
20, 2003, a money market instrument called ’Collateralised Borrowing and
Lending Obligation (CBLO)’. It is a money market instrument with original
maturity varying from one day to one year. It is fully collateralised by
government securities, deposited by the borrowers in their SGL or
constituents' subsidiary general ledger (CSGL) account with CCIL and traded
on the platform provided by CCIL. This instrument creates an obligation
on the borrower to repay the money borrowed along with interest on a
predetermined future date; and provide right and authority to the lender
to receive money lent along with interest on the predetermined future
date.
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31
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Lower Tier II Bonds
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Lower tier II bonds are rupee
tier II subordinated debt which can be raised by Indian banks for
inclusion in lower tier II capital, subject to prescribed terms and
conditions. Foreign banks operating in India can raise subordinated debt
in tier II capital by way of head office borrowings in foreign currency,
subject to prescribed guidelines.
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32
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Upper Tier II Bonds
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Upper tier II bonds are the
debt capital instruments issued by Indian banks and qualify the required
terms and conditions as set out in Annex-3, and also the capital
instruments such as perpetual cumulative preference shares (PCPS),
redeemable non-cumulative preference shares (RNCPS) and redeemable
cumulative preference shares (RCPS) qualifying terms and conditions as
set out in Annex-4, of the extant master circular on ’Prudential
Guidelines on Capital Adequacy and Market Discipline - New Capital
Adequacy Framework (NCAF)’.
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33
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Hybrid Capital
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Hybrid capital instruments are
those which have close similarities to equity, in particular when they
are able to support losses on an ongoing basis without triggering
liquidation. These are included as part of tier II capital subject to
prescribed guidelines.
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34
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Securitised Debt Instruments
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Securitised debt instruments
are debt obligations created out of cash flows from the pool of
securitised assets.
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35
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Redeemable Debt Instruments
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Redeemable debt instruments
are the bonds / debentures which Indian banks may raise to augment
capital funds for capital adequacy purpose, subject to prescribed
guidelines.
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36
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Subordinated Debt
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Subordinated debt refers to
debt instruments eligible for inclusion in Tier II capital subject to
prescribed guidelines. These instruments rank subordinate to claims of
other debts in the case of bankruptcy or liquidation of the debtor.
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37
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Long-term Time Deposit
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As per the Master
Circular on cash reserve ratio (CRR)/ statutory liquidity ratio (SLR)
dated July 01, 2015, long-term time deposits are deposits of contractual
maturity of more than one year.
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38
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Core Deposits
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Core deposits is the sum of
all deposits (including current and savings accounts) with maturity of
more than a year (as reported in structural liquidity statement) and net
worth.
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39
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Unclaimed Deposits
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All accounts in India which
have not been operated for 10 years. Provided that in case of money
deposited for a fixed period the said term of 10 years shall be reckoned
from the date of expiry of such period
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40
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Exchange Earners Foreign
Currency Account/ Deposits (EEFC)
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Exchange Earners' Foreign
Currency Account (EEFC) is an account maintained in foreign currency with
an authorised dealer i.e. a bank dealing in foreign exchange. It is a
facility provided to the foreign exchange earners, including exporters,
to credit 100 per cent of their foreign exchange earnings to the account,
so that the account holders do not have to convert foreign exchange into
rupees and vice versa, thereby minimising the transaction costs.
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41
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Risk Provisions
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Risk provisions cover all
charges to profit and loss account to record actual losses / diminution
in values recognised and losses / diminution in values estimated and
recogonized by the bank during a financial year.
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42
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Para-banking Activities
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Para-banking activities are
those permitted activities which a banking company may engage, in
addition to the business of banking, under Sub-Section 1 of Section 6 of
the Banking Regulation Act 1949 subject to regulatory guidelines issued
on para-banking activities.
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43
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Offshore Banking Units
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An offshore banking unit is a
branch of a bank located in a special economic zone (SEZ) and which has
obtained the permission under clause (a) of Sub-Section (1) of Section 23
of the Banking Regulation Act, 1949 as defined in Para 2 (u) of Chapter 1
of ’The Special Economic Zones Act, 2005‘ dated June 23, 2005.
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44
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Liability on Partly Paid-up
Shares
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Liability on partly paid-up
shares arise when only a portion of the face value of shares has been
paid and the shareholder is still required to pay the remaining amount to
the issuer company.
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45
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Forward Deposits
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Forward deposits is a
commitment to place deposits at a future date for an agreed amount and at
pre-determined rate. It is an off-balance sheet item.
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46
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Non-funded Commitments
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Non-funded commitments include
any commitment which is not covered under funded commitments.
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47
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Non-fund Based Advances
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Non-fund based advances refer
to contingent credits which are off-balance sheet exposure such as letter
of credit, guarantees, etc. issued to a borrower.
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48
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Short-term Facilities by Bank
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Short term facilities are
credit facilities (funded and/ or non-funded) for less than one year.
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49
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Revolving Underwriting
Facilities
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Revolving underwriting
facilities is an agreement whereby a bank agrees to provide credit
facility to an issuer (borrower) by buying any unsold notes / bonds as
per the agreed terms and conditions.
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50
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Formal Standby Facilities and
Credit Lines
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A formal standby facility or
credit line is a formalised arrangement in which the counterparty has the
right, but not the obligation to draw funds to a specified limit.
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51
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Gross Exposure
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Gross exposure includes credit
exposure (funded and non-funded credit limits) and investment exposure
(including underwriting and similar commitments) without making
adjustments.
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52
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Net Funded Exposure
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Net funded exposure is the
gross exposure ‘minus’ collaterals, guarantees, insurance etc. Netting
may be permitted for cash collaterals, bank guarantees and credit
insurance available in/ issued by countries in a lower risk category than
the country on which exposure is assumed.
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53
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Real Estate Exposures
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Real Estate is generally
defined as an immovable asset - land (earth space) and the permanently
attached improvements to it. Real estate exposure includes exposure to
home loans, commercial real estate loans, loans against property,
investments in mortgaged backed securities, etc.
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54
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Securitisation Exposures
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Securitisation means a process
by which a single performing asset or a pool of performing assets are
sold to a bankruptcy remote SPV and transferred from the balance sheet of
the originator to the SPV in return for an immediate cash payment.
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55
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Re-securitisation Exposures
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A re-securitisation exposure
is a securitisation exposure in which the risk associated with an
underlying pool of exposures is trenched and at least one of the
underlying exposures is a securitisation exposure. In addition, an exposure
to one or more re-securitisation exposures is a re-securitisation
exposure.
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56
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Non- market Related Exposure
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Non market related exposure
are off-balance sheet exposure (other than market related off balance
sheet exposures) such as direct credit substitutes, trade and performance
related contingent items and commitments with certain drawdown, other
commitments, etc.
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57
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Market Related Exposure
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Market related exposure
includes foreign exchange contracts, interest rate contracts, and any
other market related contracts specifically allowed by the Reserve Bank
which gives rise to credit risk.
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58
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Credit Risk
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Credit risk is the possibility
of losses associated with diminution in the credit quality of borrowers
or counterparties. Credit risk emanates from a bank’s dealings with an
individual, corporate, bank, financial institution or a sovereign.
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59
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Credit Event Payments
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Credit event payment is the
amount which is payable by the credit protection provider to the credit
protection buyer under the terms of the credit derivative contract
following the occurrence of a credit event.
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60
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Adjusted Value of Credit Risk
Mitigant
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Adjusted value of credit risk
mitigant is the value of guarantees and eligible collaterals after
application of 'haircuts' as per extant instructions on capital adequacy
framework.
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61
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Risk Adjusted Value
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Risk adjusted value is the net
exposure (exposure adjusted for collaterals after applying haircuts)
multiplied by the applicable risk weight.
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62
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Risk Weighted Assets
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Risk weighted assets are
calculated as per risk weights assigned to each asset (funded/
non-funded) as per prescribed guidelines.
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63
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Credit Default Swap (CDS)
Transaction
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Credit Default Swap (CDS) is a
bilateral derivative contract on one or more reference assets in which
the protection buyer pays a fee through the life of the contract in
return for a credit event payment by the protection seller following a
credit event of the reference entities.
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64
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Forex Buy Sell Swaps
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A forex buy sell swap involves
buying foreign currency on a near maturity date and simultaneous selling
of the foreign currency on a future maturity date as per the agreement
between the parties Over the counter (OTC)
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65
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Forex Sell Buy Swaps
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A forex sell buy swap involves
selling foreign currency on a near maturity date and simultaneous buying
of the foreign currency on a future maturity date as per the agreement
between the parties Over the counter (OTC)
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66
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Foreign Currency Rupee Swaps
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An agreement between two
counterparties whereby one counterparty agrees to exchange principal and/
or interest payments on a loan or an asset in one currency to the second
counter party, in return for receiving payments of principal and/ or
interest payments on an equivalent loan or an asset in another currency
from the second counter party as per the agreed rates.
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67
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Open Foreign Exchange Position
Limit Capital Charge
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Open foreign exchange position
limit capital charge is the capital charge, which is maintained on total
open foreign exchange position limit as the per regulatory prescriptions.
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68
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Credit Conversion Factor
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A credit conversion factor is
the factor which coverts an off-balance sheet exposure to an on-balance
sheet credit risk exposure, which in turn is multiplied by a risk weight
applicable to the counterparty to arrive at risk adjusted value for
calculation of capital to risk-weighted assets ratio (CRAR).
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69
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Market Risk
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Market risk is the risk that
the value of ’on‘ or ’off’ balance sheet positions would be adversely
affected by movements in equity and interest rate markets, currency
exchange rates and commodity prices.
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70
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Gross Mark to Market Value
(Negative/ Positive)
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Gross mark to market value
means the absolute value of a security or contract or position that
reflect its market value arrived in accordance with the agreed methods,
subject to regulatory prescriptions.
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71
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Marked to Market Positions
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Mark to market (MTM) is a
method to assess the fair value of assets or liabilities that can change
over time. Mark to market aims to provide a realistic assessment of an
institution's current financial situation.
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72
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Haircut Adjustment
|
Banks are required to adjust both
the amount of exposure to a counterparty and the value of any collateral
received in support of that counterparty to take account of possible
future fluctuations in the value of either the exposure or the
collateral, occasioned by market movements. These adjustments are
referred to as 'haircuts'.
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73
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Gap Limit
|
Cash flows mismatches in terms
of maturity buckets are called gaps which lead to liquidity and market
risk. Limits placed on such gaps to restrict liquidity or market risk is
called gap limit.
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74
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Cumulative Gap
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Cumulative gap is the
progressive summation over a sequential periodic buckets of individual
net gaps with signs. For example, cumulative gap of bucket 'over 3 months
and up to 6 months' is calculated as cumulative gap of the bucket ' 29
days and up to 3 months' plus net gap of the bucket 'over 3 months and up
to 6 months'. .
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75
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Net gap
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Net gap refers to summation of
individual bucket-wise balance sheet gap and the total of other products
with signs.
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76
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Maximum Aggregate Gap Limit
|
Maximum aggregate gap refers
to summation of tenure-wise (time bucket-wise) gaps in foreign currencies
ignoring the signs. A limit placed on the aggregate gap is called maximum
aggregate limit.
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77
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Operational Risk
|
Operational risk is the risk
of loss resulting from inadequate or failed internal processes, people
and systems or from external events. It includes legal risk, but excludes
strategic and reputational risk.
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78
|
Extraordinary Items
|
As per accounting standard 5
(AS 5), Extraordinary items are income or expenses that arise from events
or transactions that are clearly distinct from the ordinary activities of
the enterprise and, therefore, are not expected to recur frequently or
regularly.
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79
|
Hurdle Rate
|
Hurdle rate is the minimum
acceptable return on business activity. In the context of rating grades,
it refers to the rating grade (on the internal master rating scale of the
bank) below which, as per bank’s approved internal policy fresh exposures
to counterparties will not be undertaken.
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80
|
Extraordinary Loss/ Expenses/
Charges
|
As per accounting standard 5
(AS 5), extraordinary charges are expenses that arise from events or
transactions that are clearly distinct from the ordinary activities of
the enterprise and, therefore, are not expected to recur frequently or
transactions that are clearly distinct from the ordinary activities of
the enterprise and, therefore, are not expected to recur frequently or
regularly.
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81
|
Diluted Earnings
|
Diluted earnings per share is
calculated by assuming that everyone who has an instrument that can be
converted into an equity share, converts it into an equity share and so
the total number of outstanding shares of the company increases, thereby
reducing the EPS. For details, please refer to accounting standard 20 (AS
20).
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82
|
Basic Earnings Per Share
|
Basic earnings per share is
the net profit or loss for the period attributable to the equity
shareholders divided by the weighted average number of the equity shares
outstanding during the period. For details refer to accounting standard
20 (AS 20).
|
83
|
Beta Factor
|
Beta serves as a proxy for the
industry-wide relationship between the operational risk loss experience
for a given business line and the aggregate level of gross income for
that business line.
|