CM-1.8.7
The elements to be taken as indications of unlikeliness to pay must include, but not be limited to, the following:
(a) The licensee puts the profit on the credit obligation on non-accrual status;
(b) The licensee makes a charge-off or account-specific provision resulting from a significant perceived decline in credit quality subsequent to the licensee taking on the exposure;
(c) The licensee transfers the credit obligation at less than the cash equivalent value;
(d) The licensee consents to a distressed restructuring of the credit obligation where this is likely to result in a diminished financial obligation caused by the material forgiveness, or postponement, of repayment instalments;
(e) The licensee has filed for the obligor’s bankruptcy or a similar order in respect of the obligor’s credit obligation to the licensee ; or
(f) The obligor has sought or has been placed in bankruptcy or similar protection where this would avoid, or delay, repayment of the credit obligation to the licensee .
Added: June 2022