Eligible collateral and FIRB: Difference between pages

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1.  
''Capital adequacy - credit risk.''


Assets which are of sufficiently high quality to be used as collateral.
Foundation Internal Ratings Based.


Eligible collateral would normally include high quality readily marketable securities, such as gilts.
A simpler version of the Internal Ratings Based (IRB) approach to determining capital requirements for banks and other financial institutions.


Lower quality assets might be eligible, depending on the circumstances or the conditions of a particular facility.
The FIRB approach includes certain credit risk assessments made internally by the regulated institution, in combination with other standardised externally generated data.
 
 
2. ''Sterling Monetary Framework (SMF).''
 
In the context of the Bank of England's (the Bank's) SMF, eligible collateral means assets which are acceptable to the Bank as security for its lending facilities and operations under the SMF.
 
Gilts are eligible collateral for all facilities.
 
Other, lower quality, forms of collateral are eligible only for certain facilities.




== See also ==
== See also ==
* [[Bank of England]]
* [[AIRB]]
* [[Collateral]]
* [[Capital adequacy]]
* [[Collateral transformation]]
* [[Credit risk]]
* [[Encumbrance]]
* [[EAD]]
* [[Gilts]]
* [[IRB]]
* [[Haircut]]
* [[LGD]]
* [[Liquidity insurance]]
* [[PD]]
* [[Liquidity upgrade]]
* [[RWAs]]
* [[Repurchase agreement]]
* [[STA]]
* [[Sterling Monetary Framework]]
* [[Unencumbered]]

Revision as of 22:56, 21 August 2016

Capital adequacy - credit risk.

Foundation Internal Ratings Based.

A simpler version of the Internal Ratings Based (IRB) approach to determining capital requirements for banks and other financial institutions.

The FIRB approach includes certain credit risk assessments made internally by the regulated institution, in combination with other standardised externally generated data.


See also