Interpretation

17. In this Reporting Standard:

ADI means an authorised deposit-taking institution within the meaning of the Banking Act.

ADI reporting category has the meaing given in Reporting Standard ARS 701.0 ABS/RBA Definitions for the EFS Collection.

Applicant IRB ADI means an ADI that has applied for APRA’s approval to use an internal ratings-based approach to credit risk.

APRA means the Australian Prudential Regulation Authority established under the Australian Prudential Regulation Authority Act 1998.

Authorised NOHC has the meaning given in the Banking Act.

Banking Act means the Banking Act 1959.

Branch of a foreign bank means a foreign ADI as defined in the Banking Act.

Credit conversion factor (CCF) means the percentage value used to convert an off-balance sheet exposure into an on-balance sheet equivalent (i.e. the credit equivalent amount).

Credit equivalent amount (CEA) means the on-balance sheet equivalent of an off-balance sheet exposure.

Immediate parent NOHC means an authorised NOHC, or a subsidiary of an authorised NOHC, that is an immediate parent NOHC within the meaning of Prudential Standard APS 001 Definitions (APS 001).

IRB ADI means an ADI with approval from APRA to use an internal ratings-based (IRB) approach to credit risk.

Level 1 has the meaning given to that expression in APS 001.

Level 2 has the meaning given to that expression in APS 001.

Netting means the process under a netting agreement of combining all relevant outstanding transactions between two counterparties and reducing them to a single net sum for a party to either pay or receive (refer to Attachment I of APS 112).

Notional principal amount means the face value or gross amount of a given off-balance sheet transaction and not the fair value.

Off-balance sheet exposures are exposures that need to be converted to a CEA before they can be risk-weighted. Prior to the adoption of International Financial Reporting Standards (IFRS) for reporting periods beginning on or after 1 January 2005 some items, e.g. derivatives for accounting purposes, were treated as off-balance sheet. After the adoption of IFRS some of these items for accounting purposes were brought on-balance sheet. For the purposes of this APRA reporting form continue to report items that were off-balance sheet before the adoption of IFRS as off-balance sheet.

Provider of purchased payment facilities means an ADI that is subject to a condition on its authority under section 9 of the Banking Act confining the banking business that the ADI is authorised to carry on to providing purchased payment facilities.