In case of non-compliance³ with the large exposure limits (as set out in other modules of the Rulebook), the excess will be deducted from the capital of the bank for regulatory capital purposes. For off-balance sheet items, the excess is to be calculated after the application of credit conversion factors as detailed in chapter CA-4 of the Capital Adequacy Module for Islamic banks. These deduction requirements apply for direct exposures (i.e. funded by a bank's own funds or unrestricted investment accounts) and restricted investment accounts.

³ For the purpose of this rule, non-compliance means where a large exposure is taken without prior approval of CBB.