The reported item is unencumbered in accordance with the requirements of prudential standards for High Quality Liquid Assets, or is subject to an encumbrance approved for a prudential purpose by the relevant regulator.

The reported amount has been pledged, or lodged, with an entity to support, or secure, the derivative positions, or derivative exposures, of the reporting party.A derivative is a financial instrument that is derived from some other asset, index, value or other variable (known as the underlying). Derivatives allow risk about the price of the underlying asset to be transferred from one party to another.Derivative contracts involve:- Future delivery, receipt or exchange of financial items such as cash or another derivative instrument; or- Future exchange of real assets for financial items where the contract may be tradeable and has a market value.The contracts can either be binding on both parties (e.g. as with a currency swap) or subject to the exercise by one party of a right contained within the contract (as with options).