BANK 4.6.45 Non-controlled early amortisation and uncommitted retail credit lines

(1) For uncommitted retail credit lines (such as credit card receivables) in securitisations that have non-controlled early amortisation provisions that can be triggered by the excess spread falling to a specified level, a banking business firm must compare the three-month average excess spread to the point at which the bank is required to trap excess spread (the excess spread trapping point) as economically required by the structure.
(2) If a securitisation does not require the trapping of excess spread, the excess spread trapping point for the securitisation is 4.5 percentage points more than the excess spread at which early amortisation is triggered.
Inserted by QFCRA RM/2017-2 (as from 1st April 2017).