IBANK 8.4.11 Level 2A HQLA

Level 2A HQLA consists of:

(a) sukuk and other Shari'a-compliant marketable securities that represent claims on, or claims guaranteed by, a sovereign, a central bank, a public sector entity or an MDB, and meet all of the following conditions:
(i) they are assigned a risk weight of 20% under Part 4.4;
(ii) they are traded in large, deep and active repo or cash markets with a low level of concentration;
(iii) they have a proven record as a reliable source of liquidity in the markets (repo or sale) even under stressed market conditions (that is, they showed no more than 10% decline in price (or 10 percentage points increase in haircut) over a 30-calendar-day period of significant liquidity stress);
(iv) they are not an obligation of a financial institution nor of a related party of a financial institution; and
(b) sukuk and other Shari'a-compliant marketable corporate securities (including Shari'a-compliant commercial paper) that meet all of the following conditions:
(i) they are not an obligation of a financial institution nor of a related party of a financial institution;
(ii) they are rated no lower than AA- (long-term) or A-1 (short-term) by Standard & Poor's (or the equivalent by another ECRA);
(iii) they are traded in large, deep and active repo or cash markets with a low level of concentration;
(iv) they have a proven record as a reliable source of liquidity in the markets (repo or sale) even under stressed market conditions (that is, they showed no more than 10% decline in price (or 10 percentage points increase in haircut) over a 30-calendar-day period of significant liquidity stress).

Note The Regulatory Authority may approve assets of other kinds as level 2A HQLA — see rule 8.4.13.
Inserted by QFCRA RM/2018-2 (as from 1st May 2018).