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Version status: Amended | Document consolidation status: Updated to reflect all known changes
Version date: 9 July 2024 - onwards
  Version 5 of 5    

Article 5 Definitions specific to capital requirements for credit risk

For the purposes of Part Three, Title II, the following definitions shall apply:

(1) "exposure" means an asset or off-balance sheet item;

(2) "loss" means economic loss, including material discount effects, and material direct and indirect costs associated with collecting on the instrument;

(3) "expected loss" or "EL" means the ratio, related to a single facility, of the amount expected to be lost on an exposure from any of the following: (a) a potential default of an obligor over a one-year period to the amount outstanding at default; (b) a potential dilution event over a one-year period to the amount outstanding at the date of occurrence of the dilution event.

(4) "credit obligation" means any obligation arising from a credit contract, including principal, accrued interest and fees, owed by an obligor;

(5) "credit exposure" means any on- or off -balance-sheet item, that results, or may result, in a credit obligation;

(6) "facility" or "credit facility" means a credit exposure

Comparing proposed amendment...