PIB A4.11.9

(1) This Rule applies to an Authorised Firm in Category 2 and 3A.
(2) An Authorised Firm may treat as exempt from the Concentration Risk limits in PIB chapter 4 an Exposure to a Counterparty or CounterpartiesConnected to the Authorised Firm if all of the following conditions are met:
(a) the Authorised Firm has given the DFSA written notice one month in advance of its intention to use the exemption and explained how it will ensure that it will still meet the Concentration Risk limits on a continuing basis when using the exemption;
(b) the total amount of the Exposures that an Authorised Firm is treating as exempt under this Rule does not exceed 50% of the Authorised Firm's Tier 1 Capital;
(c) the Authorised Firm makes and retains a record that identifies each Exposure it has treated in this way;
(d) the Authorised Firm is subject to consolidated supervision;
(e) the Counterparty is:
(i) an Authorised Firm which is the subject of consolidated supervision; or
(ii) a member of the Authorised Firm'sGroup which is the subject of consolidated supervision to the satisfaction of the DFSA; and
(f) the Exposure satisfies one or more of conditions (i) to (iii):
(i) it is a loan made by the Authorised Firm with a maturity of one year or less in the course of the Authorised Firm carrying on a treasury role for other members of its Group;
(ii) it is a loan to the Parent of the Authorised Firm made in the course of a business carried on by the Authorised Firm of lending to its parent cash that is surplus to the needs of the Authorised Firm, provided that the amount of that surplus fluctuates regularly; or
(iii) it arises from the Authorised Firm or a CounterpartyConnected to the Authorised Firm operating a central risk management function for Exposures arising from Derivatives contracts.
Derived from RM111/2012 (Made 15th October 2012). [VER20/12-12]
[Amended] DFSA RMI293/2021 (Made 24th February 2021). [VER38/04-21]