BANK 3.2.35 Investments in own shares and capital instruments

(1) A banking business firm must deduct direct or indirect investments in its own common shares or own capital instruments (except those that have been derecognised under IFRS or any other relevant accounting standards). The firm must also deduct any of its own common shares or instruments that it is contractually obliged to purchase.
(2) The gross long positions may be deducted net of short positions in the same underlying exposure only if the short positions involve no counterparty risk. However, gross long positions in its own shares resulting from holdings of index securities may be netted against short positions in its own shares resulting from short positions in the same underlying index, even if those short positions involve counterparty risk.
Derived from QFCRA RM/2014-2 (as from 1st January 2015).