PET - Plain English Taxonomy

Attribute: R01290
Concept:
Label: Adjusted balance - Category three facilities
Concept Guidance:
This is the adjusted balance of accounts at the relevant date that meet the provisioning requirements in accordance with the Prescribed Provisioning methodology outlined in the relevant prudential standards, but have not been classified by the reporting party as Category One, Two or Four facilities.The adjusted balance is the "Outstanding balance" (see below) offset by the amount of any collateral security held that satisfies the requirements of the relevant prudential standards, or APRA has agreed on an appropriate basis to ascribe value for security purposes.Outstanding balances should be reported net of interest and other income not taken to profit, and net of any amounts written off. For overdraft facilities and revolving lines of credit, the outstanding balance is to be reported as the total amount of the facility outstanding, and not the amount that the facility exceeds the previously approved limit. For overdrawn savings accounts, the outstanding balance represents the debit balance of the account. 
Form-Specifc Guidance:
Where an exposure falling within this category is secured by a mortgage over a residential property, the provision may be adjusted to reflect a part of the collateral value. When this occurs, the minimum provision percentage in the table shall be applied to the difference between the outstanding balance (less any loan insurance) and 70 per cent of the security value (where the exposure is 6 months or more worth of payments past due, the valuation must be no older than 12 months). Where an exposure is secured by other than residential property, an ADI may approach APRA to discuss an appropriate basis upon which to value security held.
Where an exposure is otherwise secured by equivalent or better security arrangements than that described above, an ADI may, on application to APRA, seek to have the provision adjusted to reflect the whole or part of the collateral value. The following guidelines apply to these security arrangements:
(a) guarantees provided by Commonwealth or State governments, or ADIs, may be deducted from the exposure at full value prior to applying the prescribed provisioning requirements;
(b) crown leases involving property used for residential purposes may be adjusted in accordance with paragraph 7 of these instructions;
(c) bank bills and Government Securities held as collateral if subject to enforceable security in favour of the ADI, may be deducted from the exposure at net current market value prior to applying the prescribed provisioning requirements; and
(d) cash on deposit with the ADI may only be deducted for the purposes of prescribed provisioning where the deposits are secured by appropriate contractual arrangements that satisfy the eligible collateral provisions contained in Prudential Standard APS 112 Capital Adequacy: Standardised Approach to Credit Risk. A right of offset is not considered to provide appropriate security per se.
Dimensions
Dimension Member Description
(PrescribedPastDue273DLT365D)
This dimension classifies assets according to the likelihood of their full economic benefits being realised.
The data reported relates to credit exposures where the following criteria are met:(1) the facility is not subject to a regular repayment schedule and has remained continuously outside contractual or approved arrangements for a period of 273 days or more, but less than 365 days; or(2) the facility is subject to a regular repayment schedule and: (2a) at least 273 calendar days, but not more than 365 days have elapsed since the due date of a contractual payment that has not been met in full; and (2b) the total amount outside contractual arrangements is equivalent to at least 273 days', but less than 365 days', worth of contractual payments.