Related provisions for BIPRU 12.7.9
Table: Instruments which result in notional positions
This table belongs to BIPRU 7.3.2R(2)
Instrument |
See |
|
Depository receipts |
||
Convertibles where: |
(a) the convertible is trading at a market price of less than 110% of the underlying equity; and the first date at which conversion can take place is less than three months ahead, or the next such date (where the first has passed) is less than a year ahead; or |
|
(b) the conditions in (a) are not met but the firm includes the convertible in its equity PRR calculation rather than including it in its interest rate PRR calculation set out in BIPRU 7.2 (Interest rate PRR). |
||
Futures, forwards, CFDs and synthetic futures on a single equity |
||
Futures, forwards, CFDs and synthetic futures on a basket of equities or equity index |
||
Options or warrants on a single equity, an equityfuture, a basket of equities or an equity index (unless the firm calculates a PRR on the option or warrant under BIPRU 7.6). |
Articles 3 to 23 of the PD Regulation provide for the minimum information to be included in a prospectus:
Note: the Annexes (including schedules and building blocks) referred to in these articles are set out for information in PR App 3.
Article 3 Minimum information to be included in a prospectus |
A prospectus shall be drawn up by using one or a combination of the following schedules and building blocks set out in Articles 4 to 20, according to the combinations for various types of securities provided for in Article 21. |
A prospectus shall contain the information items required in Annexes I to XVII depending on the type of issuer and securities involved, provided for in the schedules and building blocks set out in Articles 4 to 20. Subject to Article 4a(1), a1 competent authority shall not request that a prospectus contains information items which are not included in Annexes I to XVII. 1 |
In order to ensure conformity with the obligation referred to in [section 87A(2) of the Act], the [FSA], when approving a prospectus in accordance with [section 87A of the Act], may require that the information provided by the issuer, the offeror or the person asking for admission to trading on a regulated market be completed, for each of the information items, on a case by case basis. |
Article 4 Share registration document schedule |
|||
1. |
For the share registration document information shall be given in accordance with the schedule set out in Annex I. |
||
2. |
The schedule set out in paragraph 1 shall apply to the following: |
||
(1) |
shares and other transferable securities equivalent to shares; |
||
(2) |
other securities which comply with the following conditions: |
||
(a) |
they can be converted or exchanged into shares or other transferable securities equivalent to shares, at the issuer’s or at the investor’s discretion, or on the basis of the conditions established at the moment of the issue, or give, in any other way, the possibility to acquire shares or other transferable securities equivalent to shares, and |
||
(b) |
provided that these shares or other transferable securities equivalent to shares are or will be issued by the issuer of the security and are not yet traded on a regulated market or an equivalent market outside the Community at the time of the approval of the prospectus covering the securities, and that the underlying shares or other transferable securities equivalent to shares can be delivered with physical settlement. |
1Article 4a Share registration document schedule in cases of complex financial history or significant financial commitment |
|||
1. |
Where the issuer of a security covered by Article 4(2) has a complex financial history, or has made a significant financial commitment, and in consequence the inclusion in the registration document of certain items of financial information relating to an entity other than the issuer is necessary in order to satisfy the obligation laid down in Article 5(1) of Directive 2003/71/EC, those items of financial information shall be deemed to relate to the issuer. The competent authority of the home Member State shall in such cases request that the issuer, the offeror or the person asking for admission to trading include those items of information in the registration document. Those items of financial information may include pro forma information prepared in accordance with Annex II. In this context, where the issuer has made a significant financial commitment any such pro forma information shall illustrate the anticipated effects of the transaction that the issuer has agreed to undertake, and references in Annex II to “the transaction” shall be read accordingly. |
||
2. |
The competent authority shall base any request pursuant to paragraph 1 on the requirements set out in item 20.1 of Annex I as regards the content of financial information and the applicable accounting and auditing principles, subject to any modification which is appropriate in view of any of the following factors: |
||
(a) |
the nature of the securities; |
||
(b) |
the nature and range of information already included in the prospectus, and the existence of financial information relating to an entity other than the issuer in a form that might be included in a prospectus without modification; |
||
(c) |
the facts of the case, including the economic substance of the transactions by which the issuer has acquired or disposed of its business undertaking or any part of it, and the specific nature of that undertaking; |
||
(d) |
the ability of the issuer to obtain financial information relating to another entity with reasonable effort. |
||
Where, in the individual case, the obligation laid down in Article 5(1) of Directive 2003/71/EC may be satisfied in more than one way, preference shall be given to the way that is the least costly or onerous. |
|||
(3) |
Paragraph 1 is without prejudice to the responsibility under national law of any other person, including the persons referred to in Article 6(1) of Directive 2003/71/EC, for the information contained in the prospectus. In particular, those persons shall be responsible for the inclusion in the registration document of any items of information requested by the competent authority pursuant to paragraph 1. |
||
(4) |
For the purposes of paragraph 1, an issuer shall be treated as having a complex financial history if all of the following conditions apply: |
||
(a) |
its entire business undertaking at the time that the prospectus is drawn up is not accurately represented in the historical financial information which it is required to provide under item 20.1 of Annex I; |
||
(b) |
that inaccuracy will affect the ability of an investor to make an informed assessment as mentioned in Article 5(1) of Directive 2003/71/EC; and |
||
(c) |
information relating to its business undertaking that is necessary for an investor to make such an assessment is included in financial information relating to another entity. |
||
(5) |
For the purposes of paragraph 1, an issuer shall be treated as having made a significant financial commitment if it has entered into a binding agreement to undertake a transaction which, on completion, is likely to give rise to a significant gross change. In this context, the fact that an agreement makes completion of the transaction subject to conditions, including approval by a regulatory authority, shall not prevent that agreement from being treated as binding if it is reasonably certain that those conditions will be fulfilled. In particular, an agreement shall be treated as binding where it makes the completion of the transaction conditional on the outcome of the offer of the securities that are the subject matter of the prospectus or, in the case of a proposed takeover, if the offer of securities that are the subject matter of the prospectus has the objective of funding that takeover. |
||
(6) |
For the purposes of paragraph 5 of this Article, and of item 20.2 of Annex I, a significant gross change means a variation of more than 25%, relative to one or more indicators of the size of the issuer's business, in the situation of an issuer. |
Recital 9 |
Pro forma financial information is needed in case of significant gross change, i. e. a variation of more than 25% relative to one or more indicators of the size of the issuer's business, in the situation of an issuer due to a particular transaction, with the exception of those situations where merger accounting is required. |
Article 5 Pro-forma financial information building block |
For pro-forma financial information, information shall be given in accordance with the building block set out in Annex II. |
Pro forma financial information should be preceded by an introductory explanatory paragraph that states in clear terms the purpose of including this information in the prospectus. |
Article 6 Share securities note schedule |
|
1. |
For the share securities note information is necessary to be given in accordance with the schedule set out in Annex III. |
2. |
The schedule shall apply to shares and other transferable securities equivalent to shares |
Article 7 Debt and derivative securities registration document schedule for securities with a denomination per unit of less than EUR 50 000 |
For the debt and derivative securities registration document concerning securities which are not covered in Article 4 with a denomination per unit of less than EUR 50 000or, where there is no individual denomination, securities that can only be acquired on issue for less than EUR 50 000per security, information shall be given in accordance with the schedule set out in Annex IV. |
Article 8 Securities note schedule for debt securities with a denomination per unit of less than EUR 50 000 |
|
1. |
For the securities note for debt securities with a denomination per unit of less than EUR 50 000information shall be given in accordance with the schedule set out in Annex V. |
2. |
The schedule shall apply to debt where the issuer has an obligation arising on issue to pay the investor 100% of the nominal value in addition to which there may be also an interest payment. |
Article 9 Guarantees building block |
For guarantees information shall be given in accordance with the building block set out in Annex VI. |
Article 10 Asset backed securities registration document schedule |
For the asset backed securities registration document information shall be given in accordance with the schedule set out in Annex VII. |
Article 11 Asset backed securities building block |
For the additional information building block to the securities note for asset backed securities information shall be given in accordance with the building block set out in Annex VIII. |
Article 12 Debt and derivative securities registration document schedule for securities with a denomination per unit of at least EUR 50 000 |
For the debt and derivative securities registration document concerning securities which are not covered in Article 4 with a denomination per unit of at least EUR 50 000or, where there is no individual denomination, securities that can only be acquired on issue for at least EUR 50 000per security, information shall be given in accordance with the schedule set out in Annex IX. |
Article 13 Depository receipts schedule |
For depository receipts issued over shares information shall be given in accordance with the schedule set out in Annex X. |
Article 14 Banks registration document schedule |
|
1. |
For the banks registration document for debt and derivative securities and those securities which are not covered by article 4 information shall be given in accordance with the schedule set out in Annex XI. |
2. |
The schedule set out in paragraph 1 shall apply to credit institutions as defined in point (a) of Article 1(1) of Directive 2000/12/EC as well as to third country credit institutions which do not fall under that definition but have their registered office in a state which is a member of the OECD. |
These entities may also use alternatively the registration document schedules provided for under in Articles 7 and 12. |
Article 15 Securities note schedule for derivative securities |
|
1. |
For the securities note for derivative securities information shall be given in accordance with the schedule set out in Annex XII. |
2. |
The schedule shall apply to securities which are not in the scope of application of the other securities note schedules referred to in Articles 6, 8 and 16, including certain securities where the payment and/or delivery obligations are linked to an underlying. |
Article 16 Securities note schedule for debt securities with a denomination per unit of at least EUR 50,000 |
|
1. |
For the securities note for debt securities with a denomination per unit of at least EUR 50 000information shall be given in accordance with the schedule set out in Annex XIII. |
2. |
The schedule shall apply to debt where the issuer has an obligation arising on issue to pay the investor 100% of the nominal value in addition to which there may be also an interest payment. |
Article 17 Additional information building block on the underlying share |
||
1. |
For the additional information on the underlying share, the description of the underlying share shall be given in accordance with the building block set out in Annex XIV. |
|
In addition, if the issuer of the underlying share is an entity belonging to the same group, the information required by the schedule referred to in Article 4 shall be given in respect of that issuer. |
||
2. |
The additional information referred to in the first subparagraph of paragraph 1 shall only apply to those securities which comply with both of the following conditions: |
|
(1) |
they can be converted or exchanged into shares or other transferable securities equivalent to shares, at the issuer’s or at the investor’s discretion, or on the basis of the conditions established at the moment of the issue or give, in any other way, the possibility to acquire shares or other transferable securities equivalent to shares; and |
|
(2) |
provided that these shares or other transferable securities equivalent to shares are or will be issued by the issuer of the security or by an entity belonging to the group of that issuer and are not yet traded on a regulated market or an equivalent market outside the Community at the time of the approval of the prospectus covering the securities, and that the underlying shares or other transferable securities equivalent to shares can be delivered with physical settlement. |
Article 18 Registration document schedule for collective investment undertakings of the closed-end type |
||
1. |
In addition to the information required pursuant to items 1, 2, 3, 4, 5.1, 7, 9.1, 9.2.1, 9.2.3, 10.4, 13, 14, 15, 16, 17.2, 18, 19, 20, 21, 22, 23, 24, 25 of Annex I, for the registration document for securities issued by collective investment undertakings of the closed-end type information shall be given in accordance with the schedule set out in Annex XV. |
|
2. |
The schedule shall apply to collective investment undertakings of the closed-end type holding a portfolio of assets on behalf of investors that: |
|
(1) |
are recognised by national law in the Member State in which it is incorporated as a collective investment undertaking of the closed end type; or |
|
(2) |
do not take or seek to take legal or management control of any of the issuers of its underlying investments. In such a case, legal control and/or participation in the administrative, management or supervisory bodies of the underlying issuer(s) may be taken where such action is incidental to the primary investment objective, necessary for the protection of shareholders and only in circumstances where the collective investment undertaking will not exercise significant management control over the operations of that underlying issuer(s). |
Article 19 Registration document schedule for Member States, third countries and their regional and local authorities |
|
1. |
For the registration document for securities issued by Member States, third countries and their regional and local authorities information shall be given in accordance with the schedule set out in Annex XVI. |
2. |
The schedule shall apply to all types of securities issued by Member States, third countries and their regional and local authorities. |
Article 20 Registration document schedule for public international bodies and for issuers of debt securities guaranteed by a member state of the OECD |
|
1. |
For the registration document for securities issued by public international bodies and for securities unconditionally and irrevocably guaranteed, on the basis of national legislation, by a state which is a member of the OECD information shall be given in accordance with the schedule set out in Annex XVII. |
2. |
The schedule shall apply to: |
- all types of securities issued by public international bodies; - to debt securities unconditionally and irrevocably guaranteed, on the basis of national legislation, by a state which is a member of the OECD. |
Article 21 Combination of schedules and building blocks |
||
1. |
The use of the combinations provided for in the table set out in Annex XVIII shall be mandatory when drawing up prospectuses for the types of securities to which those combinations correspond according to this table. However, for securities not covered by those combinations further combinations may be used. |
|
2. |
The most comprehensive and stringent registration document schedule, i.e. the most demanding schedule in term of number of information items and the extent of the information included in them, may always be used to issue securities for which a less comprehensive and stringent registration document schedule is provided for, according to the following ranking of schedules: |
|
(1) |
share registration document schedule; |
|
(2) |
debt and derivative securities registration document schedule for securities with a denomination per unit of less than EUR 50 000; |
|
(3) |
debt and derivative securities registration document schedule for securities with a denomination per unit at least EUR 50 000. |
Article 22 Minimum information to be included in a base prospectus and its related final terms |
||
1. |
A base prospectus shall be drawn up by using one or a combination of schedules and building blocks provided for in Articles 4 to 20 according to the combinations for various types of securities set out in Annex XVIII. |
|
A base prospectus shall contain the information items required in Annexes I to XVII depending on the type of issuer and securities involved, provided for in the schedules and building blocks set out in Articles 4 to 20. A competent authority shall not request that a base prospectus contains information items which are not included in Annexes I to XVII. |
||
In order to ensure conformity with the obligation referred to in [section 87A(2) of the Act], the [FSA], when approving a base prospectus in accordance with [section 87A of the Act], may require that the information provided by the issuer, the offeror or the person asking for admission to trading on a regulated market be completed, for each of the information items, on a case by case basis. |
||
2. |
The issuer, the offeror or the person asking for admission to trading on a regulated market may omit information items which are not known when the base prospectus is approved and which can only be determined at the time of the individual issue. |
|
3. |
The use of the combinations provided for in the table in Annex XVIII shall be mandatory when drawing up base prospectuses for the types of securities to which those combinations correspond according to this table. However, for securities not covered by those combinations further combinations may be used. |
|
4. |
The final terms attached to a base prospectus shall only contain the information items from the various securities note schedules according to which the base prospectus is drawn up. |
|
5. |
In addition to the information items set out in the schedules and building blocks referred to in Articles 4 to 20 the following information shall be included in a base prospectus: |
|
(1) |
indication on the information that will be included in the final terms; |
|
(2) |
the method of publication of the final terms; if the issuer is not in a position to determine, at the time of the approval of the prospectus, the method of publication of the final terms, an indication of how the public will be informed about which method will be used for the publication of the final terms; |
|
(3) |
in the case of issues of non equity securities according to [PR 2.2.7R (1)], a general description of the programme. |
|
6. |
Only the following categories of securities may be contained in a base prospectus and its related final terms covering issues of various types of securities: |
|
(1) |
asset backed securities; |
|
(2) |
warrants falling under Article 17; |
|
(3) |
non-equity securities provided for under [PR 2.2.7R (2)]; |
|
(4) |
all other non-equity securities including warrants with the exception of those mentioned in point (2). |
|
In drawing up a base prospectus the issuer, the offeror or the person asking for admission to trading on a regulated market shall clearly segregate the specific information on each of the different securities included in these categories. |
||
7. |
Where an event envisaged under [section 87G(1) of the Act (Supplementary prospectus)] occurs between the time that the base prospectus has been approved and the final closing of the offer of each issue of securities under the base prospectus or, as the case may be, the time that trading on a regulated market of those securities begins, the issuer, the offeror or the person asking for admission to trading on a regulated market shall publish a supplement prior to the final closing of the offer or the admission of those securities to trading. |
Article 23 Adaptations to the minimum information given in prospectuses and base prospectuses |
|
1. |
Notwithstanding Articles 3 second paragraph and 22(1) second subparagraph, where the issuer’s activities fall under one of the categories included in Annex XIX, the [FSA], taking into consideration the specific nature of the activities involved, may ask for adapted information, in addition to the information items included in the schedules and building blocks set out in 4 to 20, including, where appropriate, a valuation or other expert’s report on the assets of the issuer, in order to comply with the obligation referred to in [sections 87A(2),(3) and (4) of the Act]. The [FSA] shall forthwith inform the Commission thereof. |
In order to obtain the inclusion of a new category in Annex XIX a Member State shall notify its request to the Commission. The Commission shall update this list following the Committee procedure provided for in Article 24 of [the prospectus directive]. |
|
2. |
By way of derogation of Articles 3 to 22, where an issuer, an offeror or a person asking for admission to trading on a regulated market applies for approval of a prospectus or a base prospectus for a security which is not the same but comparable to the various types of securities mentioned in the table of combinations set out in Annex XVIII, the issuer, the offeror or the person asking for admission to trading on a regulated market shall add the relevant information items from another securities note schedule provided for in Articles 4 to 20 to the main securities note schedule chosen. This addition shall be done in accordance with the main characteristics of the securities being offered to the public or admitted to trading on a regulated market. |
3. |
By way of derogation of Articles 3 to 22, where an issuer, an offeror or a person asking for admission to trading on a regulated market applies for approval of a prospectus or a base prospectus for a new type of security, the issuer, the offeror or the person asking for admission to trading on a regulated market shall notify a draft prospectus or base prospectus to the [FSA]. |
The [FSA] shall decide, in consultation with the issuer, the offeror or the person asking for admission to trading on a regulated market, what information shall be included in the prospectus or base prospectus in order to comply with the obligation referred to in [sections 87A(2),(3) and (4) of the Act]. The [FSA] shall forthwith inform the Commission thereof. |
|
The derogation referred to in the first subparagraph shall only apply in case of a new type of security which has features completely different from the various types of securities mentioned in Annex XVIII, if the characteristics of this new security are such that a combination of the different information items referred to in the schedules and building blocks provided for in Articles 4 to 20 is not pertinent. |
|
4. |
By way of derogation of Articles 3 to 22, in the cases where one of the information items required in one of the schedules or building blocks referred to in 4 to 20 or equivalent information is not pertinent to the issuer, to the offer or to the securities to which the prospectus relates, that information may be omitted. |
Table There are some frequently asked questions about the application of the definition of an open-ended investment company in the following table. This table belongs to PERG 9.2.4 G (Introduction).
Question |
Answer |
|
1 |
Can a body corporate be both open-ended and closed-ended at the same time? |
In the FSA's view, the answer to this question is 'no'. The fact that the investment condition is applied to BC (rather than to particular shares in, or securities of, BC) means that a body corporate is either an open-ended investment company as defined in section 236 of the Act or it is not. Where BC is an open-ended investment company, all of its securities would be treated as units of a collective investment scheme for the purpose of the Act. A body corporate formed in another jurisdiction may, however, be regarded as open-ended under the laws of that jurisdiction but not come within the definition of an open-ended investment company in section 236 (and vice versa). |
2 |
Can an open-ended investment company become closed-ended (or a closed-ended body become open-ended)? |
In the FSA's view, the answer to this question is 'yes'. A body corporate may change from open-ended to closed-ended (and vice versa) if, taking an overall view, circumstances change so that a hypothetical reasonable investor would consider that the investment condition is no longer met (or vice versa). This might happen where, for example, an open-ended investment company stops its policy of redeeming shares or securities at regular intervals (so removing the expectation that a reasonable investor would be able to realise his investment within a period appearing to him to be reasonable). See also PERG 9.7.5 G. |
3 |
Does the liquidation of a body corporate affect the assessment of whether or not the body is an open-ended investment company? |
The FSA considers that the possibility that a body corporate that would otherwise be regarded as closed-ended may be wound up has no effect at all on the nature of the body corporate before the winding up. The fact that, on a winding up, the shares or securities of any investor in the body corporate may be converted into cash or money on the winding up (and so 'realised') would not, in the FSA's view, affect the outcome of applying the expectation test to the body corporate when looked at as a whole. The answer to Question 4 explains that investment in a closed-ended fixed term company shortly before its winding up does not, in the FSA's view, change the closed-ended nature of the company. For companies with no fixed term, the theoretical possibility of a winding up at some uncertain future point is not, in the FSA's view, a matter that would generally carry weight with a reasonable investor in assessing whether he could expect to be able to realise his investment within a reasonable period. |
4 |
Does a fixed term closed-ended investment company become an open-ended investment company simply because the fixed term will expire? |
In the FSA's view, the answer to this is 'no'. The termination of the body corporate is an event that has always been contemplated (and it will appear in the company's constitution). Even as the date of the expiry of the fixed term approaches, there is nothing about the body corporate itself that changes so as to cause a fundamental reassessment of its nature as something other than closed-ended. Addressing this very point in parliamentary debate, the Economic Secretary to the Treasury stated that the "aim and effect [of the definition] is to cover companies that look, to a reasonable investor, like open-ended investment companies". The Minister added that "A reasonable investor's overall expectations of potential investment in a company when its status with respect to the definition is being judged will determine whether it meets the definition. The matter is therefore, definitional rather than one of proximity to liquidation". (Hansard HC, 5 June 2000 col 124). |
5 |
In what circumstances will a body corporate that issues a mixture of redeemable and non-redeemable shares or securities be an open-ended investment company? |
In the FSA's view, the existence of non-redeemable shares or securities will not, of itself, rule out the possibility of a body corporate falling within the definition of an open-ended investment company. All the relevant circumstances will need to be considered (see PERG 9.6.4 G, PERG 9.2.8.8G and PERG 9.8.9 G). So the following points need to be taken into account.
|
6 |
Does "realised on a basis calculated wholly or mainly by reference to..." in section 236(3)(b) apply to an investor buying investment trust company shares traded on a recognised investment exchange because of usual market practice that the shares trade at a discount to asset value? |
In the FSA's view, the answer is 'no' (for the reasons set out in PERG 9.9.4 G to PERG 9.9.6 G). |
7 |
Does the practice of UK investment trust companies buying back shares result in them becoming open-ended investment companies? |
In the FSA's view, it does not, because its actions will comply with company law: see section 236(4) of the Act and PERG 9.6.5 G. |
8 |
Would a body corporate holding out redemption or repurchase of its shares or securities every six months be an open-ended investment company? |
In the FSA's view a period of six months would generally be too long to be a reasonable period for a liquid securities fund. A shorter period affording more scope for an investor to take advantage of any profits caused by fluctuations in the market would be more likely to be a reasonable period for the purpose of the realisation of the investment (in the context of the 'expectation' test, see PERG 9.8 and, in particular, PERG 9.8.9 G which sets out the kind of factors that may need to be considered in applying the test). |
9 |
Would an initial period during which it is not possible to realise investment in a body corporate mean that the body corporate could not satisfy the investment condition? |
In the FSA's view, the answer to that question is 'no'. In applying the investment condition, the body corporate must be considered as a whole (see PERG 9.6.3 G). At the time that the shares or securities in a body corporate are issued, a reasonable investor may expect that he will be able to realise his investment within a reasonable period notwithstanding that there will first be a short-term delay before he can do so. Whether or not the 'expectation test' is satisfied will depend on all the circumstances (see PERG 9.8.9 G). |
This table belongs to BIPRU 3.7.1 R
[Note: BCD Annex II]
Category |
Item |
Percentage |
Full risk |
Guarantees having the character of credit substitutes Credit derivatives Acceptances Endorsements on bills not bearing the name of another credit institution Transactions with recourse Irrevocable standby letters of credit having the character of credit substitutes Assets purchased under outright forward purchase agreements Forward deposits The unpaid portion of partly-paid shares and securities Asset sale and repurchase agreements as defined in Article 12(3) and (5) of the Bank Accounts Directive Other items also carrying full risk |
100% |
Medium risk |
Documentary credits issued and confirmed (see also medium/low risk). Warranties and indemnities (including tender, performance, customs and tax bonds) and guarantees not having the character of credit substitutes. Irrevocable standby letters of credit not having the character of credit substitutes. Undrawn credit facilities (agreements to lend, purchase securities, provide guarantees or acceptance facilities) with an original maturity of more than one year. Note issuance facilities (NIFs) and revolving underwriting facilities (RUFs). |
50% |
Medium/low risk |
Documentary credits in which underlying shipment acts as collateral and other self-liquidating transactions. Undrawn credit facilities (agreements to lend, purchase securities, provide guarantees or acceptance facilities) with an original maturity of up to and including one year which may not be cancelled unconditionally at any time without notice or that do not effectively provide for automatic cancellation due to deterioration in a borrower's creditworthiness. |
20% |
Low risk |
Undrawn credit facilities (agreements to lend, purchase securities, provide guarantees or acceptance facilities) which may be cancelled unconditionally at any time without notice, or that do effectively provide for automatic cancellation due to deterioration in a borrower's creditworthiness. Retail credit lines may be considered as unconditionally cancellable if the terms permit the firm to cancel them to the full extent allowable under consumer protection and related legislation. |
0% |