Back Custom print Link Text Only Rich Text Print

  • Limits on Exposures to Connected Counterparties

    • CM-4.4.8

      Exposures to connected counterparties may be justified only when undertaken for the clear commercial advantage of the bank, when negotiated and agreed on an arm's length basis, and when included in the large exposures policy statement agreed with the CBB.

      Amended: January 2011
      October 2007

    • CM-4.4.8A

      A bank may not exceed the individual or aggregate connected counterparty limits shown in Paragraph CM-4.4.13 without the prior written approval of the CBB.

      Added: July 2012

    • CM-4.4.9

      A bank may not undertake exposures to its own external auditors. In this context, 'external auditors' refers to the firm/partnership, the partners, the directors and managers of the audit firm.

      Amended: January 2011
      October 2007

    • CM-4.4.9A

      Any on-balance sheet utilisation of existing/outstanding restricted investment accounts (RIAs) or any movement of funds between RIAs is not permitted unless specifically permitted under a valid contract between the bank and the relevant customer.

      Amended: January 2015
      Amended: January 2012
      Added: January 2011

    • CM-4.4.10

      For the purpose of this Module, 'Connected counterparties' includes companies or persons connected with the bank, including, in particular; controllers of the bank (and their appointed board representatives) as defined in Chapter GR-5; subsidiaries, associates and related parties of the bank as defined by IFRS; holders of controlled functions in the bank as defined by Module LR-1A and their close family members (as defined by IFRS–IAS 24); members of the Shari'a Supervisory Board.

      Amended: January 2015
      Amended: July 2012
      Amended: July 2011
      Amended: January 2011
      Amended: April 2008
      October 2007

    • CM-4.4.10A

      Equity participations in and credit exposures to consolidated banking and financial subsidiaries (see CM-4.2.1(c)) need not be included in exposures to connected counterparties for the sake of the table in CM-4.4.13. Equity participations in and credit or financing exposures to unconsolidated subsidiaries are included in the definition of exposure in order to understand the degree of support the parent is supplying to its unconsolidated subsidiaries on a day-to-day basis.

      Added: January 2015

    • CM-4.4.10B

      The CBB shall exercise its discretion in applying the definition of connected counterparties of a bank on a case by case basis if it finds during its onsite or offsite supervisory review any linkage of such counterparties.

      Added: January 2017

    • CM-4.4.11

      Lending to senior management is covered under Chapter CM-5. All credit facilities to senior management are included under the limits given in the table under Paragraph CM-4.4.13.

      Amended: January 2015
      Amended: January 2011
      October 2007