CTHRepealedLegislation
Banking (prudential standard) determination No. 6 of 2006 - Prudential Standard APS 120 - Funds Management and Securitisation
Clean saleClean sale
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Clean sale
- An ADI will be relieved of the need to hold capital in support of assets sold to SPVs only where the sale of the assets is clean and final (refer AGN 120.3). An ADI may incur risks or returns in respect of the assets sold as a result of the ADI providing facilities covered by this Prudential Standard or the associated Guidance Notes. Should the ADI retain any obligation, risk or interest relating to the assets sold other than arising from such facilities, the assets must be treated as if they were still on the ADI’s balance sheet. In supplying assets to SPVs, ADIs should ensure that it will not lead to deterioration in the average quality of assets remaining on its balance sheet.