PIB 4 Part 1 PIB 4 Part 1 — Application
PIB 4.1 PIB 4.1 Application
PIB 4.1.1 PIB 4.1.1
This chapter applies to an
Authorised Firmin Category1, 2, 3A or 5.Derived from RM111/2012 (Made 15th October 2012). [VER20/12-12]
PIB 4.1.1 Guidance1. This chapter imposes systems and controls pertaining to
Credit Risk, and prescribes the manner of calculation of the Credit Risk Capital Requirement(also referred to in this module as CRCOM).2. Rules PIB 3.8.2 and PIB 3.8.3 provide that the CRCOMis a component in the calculation of the overall Risk Capital Requirementof an Authorised Firm, and that the CRCOMis to be calculated in accordance with this PIB chapter 4.3. The Rulesin PIB section 4.8 provide that the Authorised Firm's CRCOMis 8% of the Credit RWAof the firm, which in turn is calculated as the sum of:a. the RWAfor Credit Risk Exposures(CR Exposures); andb. the RWAfor securitisation Exposures(SE Exposures).4. This chapter sets out the manner in which each of those components must be calculated, monitored and controlled by an Authorised Firm.5. In addition to complying with the applicable Rulesin this chapter, an Authorised Firminvesting in or holding Islamic Contractswhether or not for the purpose of a PSIAwill need to take account of the provisions under IFR RulesIFR 5.4.6 and IFR 5.4.7 to calculate the Credit Riskfor those Islamic Contracts.