ANNEX I Classification of off-balance sheet items

1. Full risk:

(a)

guarantees having the character of credit substitutes, (e.g. guarantees for the good payment of credit facilities);

(b)

credit derivatives;

(c)

acceptances;

(d)

endorsements on bills not bearing the name of another institution;

(e)

transactions with recourse (e.g. factoring, invoice discount facilities);

(f)

irrevocable standby letters of credit having the character of credit substitutes;

(g)

assets purchased under outright forward purchase agreements;

(h)

forward deposits;

(i)

the unpaid portion of partly-paid shares and securities;

(j)

asset sale and repurchase agreements as referred to in Article 12(3) and (5) of Directive 86/635/EEC;

(k)

other items also carrying full risk.

2. Medium risk:

(a)

trade finance off-balance sheet items, namely documentary credits issued or confirmed (see also 'Medium/low risk');

(b)

other off-balance sheet items:

(i)

shipping guarantees, customs and tax bonds;

(ii)

undrawn credit facilities (agreements to lend, purchase securities, provide guarantees or acceptance facilities) with an original maturity of more than one year;

(iii)

note issuance facilities (NIFs) and revolving underwriting facilities (RUFs);

(iv)

other items also carrying medium risk and as communicated to EBA.

3. Medium/low risk:

(a)

trade finance off-balance sheet items:

(i)

documentary credits in which underlying shipment acts as collateral and other self-liquidating transactions;

(ii)

warranties (including tender and performance bonds and associated advance payment and retention guarantees) and guarantees not having the character of credit substitutes;

(iii)

irrevocable standby letters of credit not having the character of credit substitutes;

(b)

other off-balance sheet items:

(i)

undrawn credit facilities which comprise 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;

(ii)

other items also carrying medium/low risk and as communicated to EBA.

4. Low risk:

(a)

undrawn credit facilities comprising 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 institution to cancel them to the full extent allowable under consumer protection and related legislation;

(b)

undrawn credit facilities for tender and performance guarantees 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; and

(c)

other items also carrying low risk and as communicated to EBA.