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CA-5.6.13

Under the simplified approach as applied to commodities, the net position, long or short, in each commodity requires a capital charge of 15% to cater for directional risk plus an additional capital charge of 3% of the gross positions — that is, long plus short positions — to cater for basis risk. The capital charge of 15% applies to assets held by Islamic bank licensees in inventory with a view to resale or lease.

January 2015