Off-balance Sheet Items (OBS)
CA-15.3.45
OBS items include commitments (including liquidity facilities), whether or not unconditionally cancellable, direct credit substitutes, acceptances, standby letters of credit and trade letters of credit. If the OBS item is treated as a derivative exposure for the purpose of the accounting, then the item must be measured as a derivative exposure for the purpose of leverage ratio exposure.
Added: October 2018
CA-15.3.46
In the risk-based capital framework, OBS items are converted under the standardised approach into credit exposure equivalents through the use of credit conversion factors (CCFs). For the purpose of determining the exposure amount of OBS items for the leverage ratio, the CCFs set out in CA-15.4 must be applied to the notional amount.
Added: October 2018
CA-15.3.47
In addition, specific and general provisions set aside against OBS exposures that have decreased Tier 1 capital may be deducted from the credit exposure equivalent amount of those exposures (i.e. the exposure amount after the application of the relevant CCF). However, the resulting total off-balance sheet equivalent amount for OBS exposures cannot be less than zero.
Added: October 2018
