Abstract

The 2019 Financial Soundness Indicators Compilation Guide (2019 Guide) includes new indicators to expand the coverage of the financial sector, including other financial intermediaries, money market funds, insurance corporations, pension funds, nonfinancial corporations, and households. In all, the 2019 Guide recommends the compilation of 50 FSIs—13 of them new. Additions such as new capital, liquidity and asset quality metrics, and concentration and distribution measures will serve to enhance the forward-looking aspect of FSIs and contribute to increase policy focus on stability of the financial system.

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  • United States Treasury. 2017. Financial Stability Report, United States. https://www.financialresearch.gov/financial-stability-reports/fles/OFR_2017_Financial-Stability-Report.pdf and https://www.treasury.gov/initiatives/fsoc/studies-reports/Documents/FSOC_2017_Annual_Report.pdf

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  • Worrell, DeLisle. 2004. “Quantitative Assessment of the Financial Sector: An Integrated Approach.” IMF Working Paper 04/153. International Monetary Fund, Washington, DC.

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Glossary

Accrual Accounting: Accrual accounting records flows and changes in the corresponding stocks at the time economic value is created, transformed, exchanged, transferred, or extinguished. Under accrual accounting, flows and positions are recorded when a change in economic ownership takes place.

Additional Tier 1 Capital (AT1): Supervisory concept defined in Basel III, consisting of subordinated instruments with no maturity and neither secured nor covered by a guarantee of the issuer (Refer to Basel III: A Global regulatory framework for more resilient banks and banking systems for complete details).

Aggregate Resident-Based Approach: Under an aggregate resident-based approach, the headquarters office consolidates its transactions and positions with resident branch offices only, that is, not with any subsidiaries, associates, or nonresident branches. This is the approach adopted in the 2008 SNA, the sectoral balance sheets in monetary statistics, and related national accounts methodologies.

Aggregation: Refers to the summations of position or flow data. For sector-level data, aggregation is the sum of the positions and flows of all individual reporting groups/entities within the sector. The sectoral financial statements described in Chapter 5 are aggregates, where positions and flows are the sums of flows and positions of all the reporting units in the sector.

Amortized Cost: Amount advanced originally plus all accrued but not paid interest, less any repayment of principal, less any allowance for impairment or non-collectability (IFRS concept).

Arrears: When principal or interest payments are not made when due (e.g., on a loan) arrears are created. Arrears should continue to be recorded from their creation date, until they are extinguished, such as when they are repaid, rescheduled, or forgiven by the creditor. Arrears should continue to be recorded in the underlying instrument, with the exception of interest on nonperforming loans (see paragraph 5.14).

Asset: Store of value, over which ownership rights are enforced and from which their owners may derive economic benefits by holding them over a period of time.

Associates: Corporations over which the investor has a significant degree of influence, being the power to participate in the financial and operating policy decision of the investee; but not control or joint control as is the case of subsidiaries. Significant influence is usually assumed to arise when the investor controls between 10 and 50 percent of the shareholders’ voting power.

Available Stable Funding: Supervisory concept de-fned in Basel III as the portion of a banks’ capital and liabilities that are expected to remain with the bank in a stress scenario over a one-year horizon. Calibration of the presumed degree of stability considers both the funding tenor, and the funding type and counterparty. Required stable funding is institution specific, reflecting the liquidity characteristics and residual maturities of its assets and its off-bal-ance-sheet exposures. Compilers will rely on supervisory data and will not generally need to be familiar with the highly detailed specification of available stable funding and required stable funding.

Balance Sheet: Corresponds to IAS 1 concept of statement of financial position, is the statement of assets, liabilities, and capital at the end of each accounting period.

Basel Committee on Banking Supervision: Established by the Central Bank Governors of the Group of Then (G–10) countries at the end of 1974, the BCBS formulates broad supervisory standards and guidelines. It also recommends standards of best practice in the expectation that individual authorities will take steps to implement them through detailed arrangements—statutory or otherwise—that are best suited to their own national systems. It encourages convergence toward common approaches and common standards.

Basel II: The BCBS’s International Convergence of Capital Measurement and Capital Standards—A Revised Framework, released in June 2004, is a comprehensive revision of the Basel capital adequacy standards. It includes three “pillars” for ensuring the strength of banking institutions. The first pillar covers the minimum capital requirements for banks, including changes in the risk weights for assets of banks in order that they better reflect the underlying risk incurred, and it includes alternative methodologies for assessing risk, based on banks’ internal risk assessment procedures. The second pillar focuses on enhancing the supervisory review process. The third pillar focuses on enhancing market discipline over banking institutions through increased disclosures.

Basel III: The BCBS’s A Global Regulatory Framework for More Resilient Banks and Banking Systems and the International Framework for Liquidity Risk Measurement, Standards and Monitoring, both released in 2010, together with Basel III: Finalising Post-Crisis Reforms (2017) is an internationally agreed set of measures developed by the Basel Committee on Banking Supervision in response to the financial crisis of 2007–2009. These measures aim to strengthen the regulation, supervision, and risk management of banks.

Book Value: Value of an asset as recorded in an entity’s balance sheet.

Branches: Operating entities that do not have a separate legal status from their parent corporations and are thus integral part of them. A branch of a nonresident DT is identified for statistical purposes as a separate institutional unit in the economy where it operates.

CAMELS Framework: CAMELS is a commonly used supervisory framework that groups indicators of bank soundness into six categories. The categories are (1) capital adequacy, (2) asset quality, (3) management capability, (4) earnings, (5) liquidity, and (6) sensitivity to market risk

Capital Adequacy Ratio: The capital adequacy ratio is the central feature of the Basel Capital Accord. It is an analytical construct in which regulatory capital is the numerator and risk-weighted assets are the denominator. The minimum ratio of regulatory capital to risk-weighted assets is set at 8 percent (the core regulatory capital element should be at least 4 percent, increased to 6 percent in Basel III). These ratios are considered the minimum necessary to achieve the objective of securing over time soundly based and consistent capital ratios for all internationally active banks.

Capital and Reserves: Capital and reserves is the difference between total assets and total liabilities in the balance sheet. It represents the equity interest of the owners in an entity and is the amount available to absorb unidentified losses.

Capital Conservation Buffer: Extra capital that, under Basel III, a financial institution is required to hold to absorb losses during downturns.

Central Bank: National financial institution exercising control over key aspects of the financial sector. Its functions generally include: (1) issuing currency, (2) conducting monetary policy, including by regulating money supply and credit, (3) managing international reserves, (4) providing credit to deposit-taking corporations, and (5) acting as banker to government, by holding central government deposits and providing credit in the form of overdrafs, advances, and purchases of securities. Central banks frequently are the supervisory authority for the deposit-taking sector and payments systems, and less commonly, for other elements of the financial system. FSIs are not computed for the central bank.

Commercial Real Estate Loans: Loans collateralized by commercial real estate, loans to construction companies, and loans to companies active in the development of real estate (including those companies involved in the development of multi-household dwellings). Commercial real estate includes buildings, structures, and associated land used by enterprises for retail, wholesale, manufacturing, or other such purposes.

Common Equity Tier 1 capital (CET1): Supervisory concept defined in Basel III as the highest quality capital capable of absorbing losses on a going concern basis. It comprises (1) common shares, (2) retained earnings and accumulated other comprehensive income, and (3) other disclosed reserves. (Refer to Basel III: A Global regulatory framework for more resilient banks and banking systems for complete details).

Consolidation: The elimination of positions and flows that occur among institutional units that are grouped together for statistical purposes. For FSI purposes, reporting on a consolidated group basis preserves the integrity of capital by eliminating its double counting.

Consolidation Basis: The consolidation basis determines which ownership related units report data as if they formed a single encompassing entity, offset-ting positions and flows between units of the same group. The consolidation basis determines the reporting population for FSI compilation. Which units are included under a specific consolidation basis depends, among other factors, on ownership and control, including whether a unit is a branch, subsidiary, or associate, and whether it is domestic or foreign controlled.

Contingencies: Many types of contractual financial arrangements between institutional units do not give rise to unconditional requirements, either to make payments or to provide other economic assets. In this context, “conditional” means that the claim becomes effective only if a stipulated condition (or conditions) arise. Contingencies are not recognized as financial assets (liabilities) on balance sheet because they are not actual claims (or obligations). However, these arrangements can potentially affect financial soundness.

Contingent Liability: Obligation that does not arise unless a particular, discrete event(s) occurs in the future.

Countercyclical Capital Buffer: Extra capital charge to be implemented based on national authorities’ assessments of the build-up of system-wide risks and geographical credit exposure of internationally active banks.

Control of a Corporation: It exists when an entity is exposed, or has rights, to variable returns from its involvement with the corporation and has the ability to affect those returns through its power over the corporation. This IFRS definition encompasses but is somewhat broader than existing monetary and national statistics definitions of control: the ability to determine its general corporate policy and operations by choosing (or removing) appropriate directors.

Credit to the Private Sector: For DTs, gross loans extended by DTs to the private nonfinancial sector, plus debt securities issued by private NFCs and held by DTs. The data should be compiled on a domestic consolidated basis. The private sector comprises private NFCs, HHs, and NPISHs.

Credit Risk: The risk that one party to a financial contract will fail to discharge an obligation and thus cause the other party to incur a financial loss.

Cross-Border Consolidation: It involves a parent DT and its nonresident subsidiaries and branches, in addition to the resident ones. A branch or subsidiary may be resident in another economy than its parent. When such units are included in the group reporting, the data are referred to as cross-border data.

Cross-Sector Consolidation: It involves a parent DT and its financial subsidiaries (DT and non-DT). If such non-DT subsidiaries (e.g., a leasing company or a money market fund) are included in the group data of its parent DT, the data are referred to as cross-sector data.

Deferred Tax Assets: Difference between current tax charges/credits recognized by tax authorities and taxes recorded in financial statements.

Deposit-Taking Corporation (Excludes the Central Bank): Financial corporation that has financial intermediation as its principal activity and obtains funds through the acceptance of deposits or other financial instruments (e.g., short-term certificates of deposits) that are close substitutes for deposits.

Domestically Controlled Deposit Takers: If they are directly or indirectly controlled by resident shareholders. In the rare instances that the parent is located in both the domestic and a foreign economy, such subsidiaries are classified as domestically controlled.

Domestic Currency: Currency that is legal tender in the economy and is issued by the central bank or government of that economy or of the common currency area to which the economy belongs.

Economic Ownership: The economic owner of non-financial and financial assets and liabilities is the institutional unit entitled to claim the benefits associated with their use by virtue of accepting the associated risks.

Economic Territory: Area or jurisdiction under the effective economic control of a single government, for which statistics are required. It includes special zones.

Exposure at Default: The sum of debt outstanding and irrevocable commitments at the time a counterparty defaults.

External Debt: The outstanding amount of those actual current, noncontingent, and liabilities that require payments of principal or interest by the resident debtor to nonresident creditors at some point(s) in the future.

Face Value: Amount of principal to be repaid, also known as “par value” or simply “par.”

Fair Value: Market-equivalent value defined as the amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm’s length transaction.

Financial Assets: Subset of economic assets that are financial instruments and are unconditional creditor claims on economic resources of other institutional units, which give rise to corresponding liabilities of debtors. See Chapter 5 for definitions of different types of financial assets.

Financial Auxiliary: Financial corporation principally engaged in activities associated with transactions in financial assets and liabilities or with providing the regulatory context for these transactions but in circumstances that do not involve the auxiliary taking ownership of the financial assets and liabilities being transacted.

Financial Corporation (FC): Corporation principally engaged in providing financial services, including insurance and pension fund services, to other institutional units.

Foreign-Controlled Deposit Takers: DT subsidiaries or branches of a foreign parent DT, or a regulated or unregulated holding company controlled by nonresident shareholders, either directly or indirectly as described in paragraph 6.11.

Foreign Currency: Any currency other than the domestic currency.

Foreign Currency Debt: Debt that is payable in a currency other than the domestic currency and those that are payable in domestic currency but with the amounts to be paid linked to a foreign currency (foreign currency linked).

Foreign-Currency-Linked Instrument: Instruments payable in domestic currency but with the amounts payable linked to a foreign currency.

Financial Sector Assessment Program (FSAP): A joint IMF and World Bank program introduced in May 1999, the FSAP aims to increase the effectiveness of efforts to promote the soundness of financial systems in member countries. The objective of FSAP reviews is to gauge the stability and soundness of the financial sector and to assess its potential contribution to growth and development.

General Government Sector: It consists of resident institutional units that fulfill the functions of government as their primary activity. Government units are unique kinds of legal entities established by political processes that have legislative, judicial, or executive authority over other institutional units within a given area.

Goodwill: The excess of the fair (paid) value for a business entity over the book value of the acquired net assets. Accounting standard setters consider goodwill to be an asset. However, goodwill is an intangible asset, and as such not available to absorb losses.

Gross Recording: Refers to the presentation of assets and liabilities at their full value, that is, where claims on a particular institutional unit or group of units are not netted against the liabilities to that unit or group. (Net recording refers to the offsetting of these assets and liabilities, and is not recommended by the Guide; however, compilation on a net basis may be unavoidable due to lack of source data.)

Hedge Accounting: Accounting for gains and losses on financial assets and liabilities included in hedging relationships, recognizing the offsetting effects on profit or loss of changes in the fair values of the hedged instruments.

Hedging: Investment designed to offset the risk of adverse price movements in an asset.

Herfindahl Index: Measure of industry concentration calculated as the sum of the squares of the market shares of all firms in the industry.

High-Quality Liquid Assets: Supervisory concept defined in Basel III as unencumbered assets that can be converted easily and immediately into cash at little or no loss of value. The Basel III text sets out specific market-related characteristics and operational requirements that high-quality liquid assets should possess or satisfy.

Historic Cost: Cost at the time of acquisition, and sometimes it also may reflect occasional revaluations.

Holding Companies (for DTs): Units that hold the assets of subsidiary corporations but do not undertake any management activities. Their principal activity is to own and direct the group and they are not directly engaged in deposit taking.

Household: Group of persons who share the same living accommodation, pool some, or all, of their income and wealth and consume certain types of goods and services collectively, mainly housing and food.

Income and Expense Statement: Corresponds to the IAS 1 concept of statement of comprehensive income, presented as a single statement or as two statements: statement of profit or loss and a statement of other comprehensive income. The profit or loss section represents the traditional profit and loss concepts, while the other comprehensive income section presents items of income and expense that are not recognized in profit or loss, such as foreign currency translation gains or losses, as required or permitted by other IFRSs

Institutional Sector: Institutional units are allocated to different institutional sectors according to the nature of the economic activity they undertake. The resident institutional units of the economy are grouped into five mutually exclusive sectors: (1) FCs; (2) nonfinancial corporations; (3) general government; (4) households; and (5) NPISHs.

Institutional Unit: Economic entity capable, in its own right, of owning assets, incurring liabilities and engaging in economic activities and in transactions with other entities.

Insurance Corporation: Financial entity whose principal function is to provide life, accident, sickness, fire, or other forms of insurance coverage to individual institutional units or groups of units, or reinsurance services to other insurance corporations.

Internal Ratings–Based Approach: Methodology for determining the capital required for credit risk using credit ratings produced internally by a financial institution.

International Accounting Standard Board (IASB): Independent standard-setting body of the International Financial Reporting Standard Foundation. Its members are responsible for the development and publication of IFRSs and for approving interpretations of IFRSs.

International Banking Statistics (IBS): These data cover international banking business and are compiled and disseminated by the BIS on a quarterly basis. The IBS system has two main datasets: locational banking statistics, for which reporting banking institutions provide data on a residence basis; and consolidated banking statistics, which provide data on a worldwide consolidated basis.

International Financial Reporting Standards (IFRSs): Relevant international accounting and reporting principles for preparing general purpose financial statements, issued by the IASB.

Investments in Unconsolidated Subsidiaries: Holdings in affiliated financial institutions, which exceed 10 percent of equity of the parent bank.

Kurtosis: Measure of dispersion that estimates the degree of fatness of the tails of the distribution.

Large Exposures: The sum of all exposure values of a DT to a counterparty or to a group of connected counterparties, if it is equal to or above 10 percent of the DT’s eligible capital base. Specific principles are outlined for the measurement of exposure values. Off-balance-sheet exposures should be converted into credit exposure equivalents through the use of credit conversion factors.

Legal or Social Entity: Institutional unit whose existence is recognized by law or society independently of the persons, or other entities, that may own or control it.

Legal Ownership: The legal owner of nonfinancial and financial assets and liabilities is the institutional unit entitled by law and sustainable under the law to claim the associated benefits.

Leptokurtic Distribution: Distribution with fatter tails and sharper peak than the normal distribution.

Leverage: Having access to the full benefits arising from holding a position in a financial asset without having to fully fund the position with own funds. It can be built up by borrowing (on-balance-sheet leverage, commonly measured by debt-to-equity ratios) or by using financial derivatives.

Leverage Ratio: Relation between Tier 1 capital to all balance sheet assets and off-balance-sheet commitments. The ratio is to be calculated as the average monthly leverage ratio over the quarter.

Liability: Established when one unit (the debtor) is obliged, under specific circumstances, to provide funds or other resources to another unit (the creditor).

Liquid Assets (of DTs): Assets that are readily available to an entity to meet a demand for cash. In the Guide, liquid assets comprise (1) currency; (2) deposits and other financial assets that are available either on demand or within three months or less; and (3) securities that are traded in liquid markets (including repo markets) that can be readily converted into cash, with insignificant risk of change in value under normal business conditions.

Liquidity: In terms of markets, liquidity generally refers to the ability to buy and sell assets quickly and in large volume without substantially affecting the asset’s price. In terms of instruments, liquidity generally refers to those assets that can be converted into cash quickly without a significant loss in value.

Liquidity Coverage Ratio (LCR): A supervisory requirement defined in Basel III intended to promote resilience to potential liquidity disruptions over a 30-day horizon. The LCR estimates the short-term liabilities that would have to be covered by asset sales if access to funding were lost. Composition floors and haircuts ensure that high-quality liquid assets can be liquidated even in times of stress.

Liquidity Risk: The risk that assets may not be readily available to meet a demand for cash. Because deposit takers’ assets are typically of longer maturity than their liabilities, monitoring deposit takers’ liquidity risk through FSIs (e.g., liquidity assets to total assets and liquid assets to short-term liabilities) is important for financial soundness indicators.

Loss Given Default: Percentage of exposure lost when a counterparty defaults.

Macroprudential Analysis: It incorporates a range of approaches and indicators to measure systemic risks in both the time and structural dimensions. Indicators include aggregate balance sheet and income statement-derived ratios; market-based indicators such as asset prices, spreads or market liquidity measures; broad macro indicators such as ratios of credit to GDP; and other quantitative and qualitative information available to country authorities.

Market Risk: Risk of losses on financial instruments arising from changes in market prices. Market risk covers interest rate, foreign exchange, equity price, and commodity price risk.

Market Value: Value at which nonfinancial and financial assets are exchanged or else could be exchanged for cash (currency or transferable deposits).

Memorandum Series: Series required to calculate the FSIs that are not directly available from the financial statements. They are included as memorandum items to the financial statements. These series fall into two categories: (1) supervisory-based series and (2) series that provide a further analysis of the balance sheet

Mesokurtic Distribution: Distribution that does not exhibit fat tails.

Money Market Funds (MMFs): Collective investment schemes that raise funds by issuing shares or units to the public. The proceeds are invested primarily in money market instruments, MMF shares or units, transferable debt instruments with a residual maturity of not more than one year, bank deposits, and instruments that pursue a rate of return that approaches the interest rates of money market instruments.

Mortgage Servicing Rights: Capitalization of future income streams from the servicing of sold or purchased mortgage loans (as required by accounting standards).

Net Stable Funding Ratio (NSFR): A supervisory requirement defined in Basel III aimed at limiting over-reliance on short-term wholesale funding. The NSRF requires a minimum quantity of stable funding relative to relative to the liquidity profile of the bank.

Nominal Value: Outstanding amount that at any moment the debtor owes to the creditor. It reflects the funds originally advanced, plus any subsequent advances, plus interest that has accrued, less any repayment.

Nonfinancial Corporation (NFC): Corporation or a quasi-corporation whose principal activity is the production of market goods or nonfinancial services.

Non-MMF Investment Funds: Collective investment scheme that raises funds by issuing shares or units to the public. The proceeds are invested predominantly in long-term financial assets, such as equity shares, bonds, and mortgage loans, and nonfnan-cial assets, such as real estate.

Nonperforming Loans (NPLs): Loans for which (1) payments of interest or principal are past due by 90 days or more; or (2) interest payments equal to 90 days or more have been capitalized or delayed by agreement; or (3) evidence exists to reclassify a loan as nonperforming even in the absence of a 90-day past due payment, such as when the debtor files for bankruptcy.

Nonprofit Institution Serving Households (NPISHs): Legal entity principally engaged in the production of non-market services for households or the community at large, and whose main resources are voluntary contributions.

Nonprofit Institution: Legal or social entity created for the purpose of producing or distributing goods and services, but they cannot be a source of income, profit, or other financial gain for the institutional units that establish, control, or finance it.

Nonresident Unit: Institutional unit that has its center of predominant economic interest outside the economic territory under consideration.

Off-Balance-Sheet Exposures: Contractual financial arrangements often referred to as contingencies that are not financial assets or liabilities. These arrangements comprise commitments (including liquidity facilities), unconditionally cancellable commitments, direct credit substitutes, acceptances, standby letters of credit, trade letters of credit, failed transactions, and unsettled securities. Off-balance-sheet items are a source of potentially significant leverage.

Offshore Bank: Deposit-taking corporations established in jurisdictions that provide legal and fiscal advantages, such as low or no taxation and less stringent regulations in terms of reserve requirements or foreign exchange restrictions.

Operational Risk: Risk of loss resulting from inadequate internal processes or external events.

Original Maturity: Period from the date of issue until the final contractually scheduled payment.

Other Depository Corporation (ODC): For monetary statistics purposes, a financial corporation (other than the central bank) that incurs liabilities included in broad money.

Other Financial Corporation (OFC): Financial corporation that is not classified as central bank or deposit takers.

Pension Fund: Financial entity that provides retirement benefits for specific groups of individuals. To be classified as a pension fund, the entity must have its own separate sets of pension-fund assets and liabilities, with specific obligations to its contributors.

Platykurtic Distribution: Distribution with leaner tails than the normal distribution.

Positions: Level of assets or liabilities at a particular point in time. Also called stocks.

Quartile: Observation in a distribution below which lies 25 percent of the data.

Regulatory Capital: Equity and subordinated debt meeting specified conditions, defined in three tiers under Basel I and Basel II and two tiers under Basel III, that financial institutions are required to hold.

Remaining Maturity: Period from the reference date until the final contractually scheduled payment; also referred to as residual maturity.

Residence: The residence of an institutional unit is the economic territory with which it has the strongest connection, expressed as its center of predominant economic interest.

Residential Real Estate Loans: Loans collateralized by residential real estate. Residential real estate includes houses, apartments and other dwellings (e.g., houseboats and mobile homes), and any associated land intended for occupancy by individual HHs.

Required Stable Funding: See Available Stable Funding.

Risk-Weighted Assets: On- and off-balance-sheet exposures weighted according to their perceived risk. Basel I allocates different types of assets to four predefined risk-weights: 0, 20, 50, or 100 percent. Basel II introduced a more granular standardized approach using external credit ratings and an option for banks, subject to supervisory approval, to use internal models to determine risk weights.

Settlement Date: Time of delivery of a financial asset.

Skewness: Measure of dispersion that indicates the extent to which data are asymmetrically distributed around the mean.

Stable funding: Supervisory concept defined in Basel III as the portion of equity and liability financing expected to be reliable sources of funds over a one-year time horizon under conditions of extended stress.

Standardized Approach (for Credit Risk): Approach that determines risk weights using credit ratings produced by an external agency.

Subsidiaries: Entities controlled by another entity. A corporation is said to be a subsidiary of its parent when the parent is exposed, or has rights, to variable returns from its involvement with the corporation and has the ability to affect those returns through its power over the corporation.

Supervisory Deductions: Deductions from regulatory capital adjust for assets that are likely to be worthless in liquidation and to prevent the multiple use of the same capital resources. These deductions include: (1) goodwill; (2) deferred tax assets; (3) defined benefit plan deficits; (4) excess minority interest in subsidiaries; (5) profit revaluation of own debt; and (6) thresholds deductions. Deductions are applied to the different elements of capital (Tier 1, Tier 2, CET1) as prescribed by the relevant version of the Basel Capital Accord.

Systemic Risk Surcharge: Surcharge designed to provide additional safeguards around the banks classified as global systemically important banks (also known as “too big to fail”) to deal with cross-border negative externalities posed by such institutions that are not fully addressed by current regulatory policies.

Tier 1 Capital: Supervisory concept introduced in Basel I. It consists of equity capital and disclosed reserves that are considered freely available to meet claims against the bank. It comprises paid-up shares and common stock, and disclosed reserves created or increased by appropriation of retained earnings or other surplus. Goodwill is deducted from Tier 1 capital.

Tier 2 Capital: Supervisory concept introduced in Basel I including financial instruments and reserves that are available to absorb losses, but which might not be permanent or have uncertain value. It consists of (1) unsecured subordinated debt with a minimum original maturity of at least five years; (2) stock surplus resulting from the issuance of some instruments; (3) instruments issued by subsidiaries that are consolidated with the bank; (4) general provisions up to 1.25 percent of risk-weighted assets; and (5) regulatory adjustments.

Total Net Cash Outflows: Supervisory concept defined in Basel III as the total expected cash out-flows minus total expected cash inflows in the specified stress scenario for the subsequent 30 calendar days.

Value at Risk: Maximum likely loss in a given period of time in the event of extreme market moves.

Transaction: Interaction between institutional units by mutual agreement or through the operation of the law, involving an exchange of value or transfer.

Transaction Date: Time of change in ownership of a financial asset. Also called trade date.

Variance: A measure of dispersion around the mean calculated as the sum of squared deviations of each observation from the mean divided by the number of observations (for population variance) or the number of observations minus one (for sample variance).

Volatility: The tendency of quantities or prices to vary over time. Usually measured by the variance or annualized standard deviation of changes, volatility is said to be high if quantities or prices move significantly both up and down. The higher the volatility usually the higher the risk, as the ability to convert an asset into cash quickly without a significant loss in value is less certain.

Index

Numbered locators refer to paragraph numbers in chapters, appendices, and boxes, fgures, or tables.

A

  • AAOIFI. See Accounting and Auditing Organization for Islamic Financial Institutions

  • Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), 7.89

  • Accounting principles

    • currency and conversion, 4.52– 4.56

    • flows and positions, 4.3–4.4

    • accrual accounting, 4.10–4.16

    • arrears, 4.17–4.18

    • contingencies, 4.19–4.24

    • provisions for loan losses and other impaired assets, 4.25–4.34

    • maturity, 4.57–4.58

    • recording of gains and losses, 4.49–4.51

    • valuation, 4.35

      • amortized cost and fair value, 4.36–4.43

      • derivatives and hedge

      • accounting, 4.47–4.48

      • transactions, 4.44–4.46

  • Accrual accounting, 4.10–4.16, 5.28, 8.51, Glossary

  • Additional FSIs, 8.1–8.48

  • Additional Tier 1 (AT1) capital, 3.12, 3.28, 5.77, Glossary

  • Aggregated resident-based approach, 6.39, 6.40, 6.43, 9.4, 9.7, 9.16, Glossary. See also Consolidation

  • Aggregation, 6.3, 6.6, Glossary

  • Agricultural banks, 2.37

  • Amortized cost, 4.37, 4.38, Glossary

  • Arrears, 4.17–4.18, Glossary

  • Asset, 4.5, Glossary. See also Financial assets

  • Asset management companies (AMCs), 2.53, 2.56

  • Asset quality, 1.1, 5.107, 7.34, 8.44, 9.25, 10.7, 13.37, Tables 1.1–1.2

  • Associates, 6.12, Glossary

  • Available stable funding, 3.55, Glossary

  • Average-period interest rates, 8.52

B

  • Balance sheet, 5.1, 5.7–5.9, 13.35, Glossary

    • deposit takers, 5.1, 5.33–5.72, Table 5.1

    • households, 5.154–5.157, Table 5.6

    • IDTs, 7.8, Table 7A.1 intra-group consolidation, 6.47, Table 6A.2

    • nonfinancial corporations, 5.139–5.144, Table 5.5

    • other financial corporations, 5.104–5.133

      • insurance corporations, 5.119–5.122, Table 5.3

      • money market funds, 5.106– 5.108, Table 5.2

      • pension funds, 5.128–5.131, Table 5.4

  • Basel Capital Accord, 3.4–3.15

    • aggregation of capital components, 3.56, Table 3.4

    • capital requirements, 3.4, 3.8–3.9, 3.11, 3.22, 3.42, Figure 3.1

    • regulatory capital, 3.16–3.31

    • risk-weighted assets, 3.32–3.36, Tables 3.2, 3.3

  • Basel Committee on Banking Supervision (BCBS), 3.1, 3.42, 5.9, 7.89, Glossary

  • Basel I, 3.5, 3.15

    • regulatory capital, 3.24

    • risk-weighted assets, 3.32–3.34, Tables 3.2, 3.3

  • Basel II, 3.7, 3.9, Glossary

    • regulatory capital, 3.24

    • standardized approach, 4.30

  • Basel II.5, 3.10, 3.41

  • Basel III 1.3, 3.11, 3.15, Glossary

    • AT1 capital, 3.28

    • Capital conservation buffer, 3.11–3.12

    • CET1 capital requirement, 3.12, 3.27

    • counter-cyclical capital buffer, 3.11

    • Finalisation of Post Crisis Reforms (2017), 3.14, 3.36, 3.45

    • liquidity standards, 3.13, 3.49

    • leverage ratio, 3.46, 7.25–7.26

    • total regulatory capital, 3.25

  • Bond market, 2.65

  • Book value, of asset, 5.7, 5.81, Glossary

  • Branches, 6.10, Glossary

C

  • Capital adequacy, 9.48

  • Capital adequacy, Asset quality, Management capability, Earnings, Liquidity, and Sensitivity (CAMELS), 1.7, Glossary

  • Capital adequacy ratio (CAR), 7.95, 13.35, Glossary

    • eligible capital, 7.96–7.97

    • risk-weighted assets, 7.98

  • Capital adequacy standard (CAS), 7.110

  • Capital and reserves, 5.70, 5.122, 5.144, Glossary

  • Capital conservation buffer, 3.11–3.12, Glossary

  • Capital markets, 2.65

  • Captive financial institutions, 2.59–2.61

  • CDMs. See Concentration and distributions measures (CDMs)

  • Central bank, 2.30, Glossary

  • Central clearing counterparties (CCPs), 2.56

  • Combined ratio. See Non-life insurance corporations

  • Commercial Property Price Index (CPPI), 10.69–10.72

  • Commercial real estate loans, 5.98, 10.90–10.95, Glossary

  • Commodities markets, 2.62

  • Common equity Tier 1 (CET1) capital, 3.12, 3.27, 5.77, Glossary

  • Composite insurance companies, 2.49

  • Concentration and distribution measures (CDMs), 1.27, 11.31

    • compilation, 12.10–12.37

    • confidentiality issues, 12.44

    • concentration, 12.12

    • FSI compilers’ perspective, 12.8–12.9

    • pilot project, 12.4–12.7

    • reporting thresholds, 12.44, Table 12.6

    • uses, 12.38–12.43

  • Consolidated group reporting, 6.27

  • Consolidation, 6.4–6.5, Glossary

    • ownership and control of corporations, 6.8–6.20, Glossary

  • Consolidation basis, 6.21–6.26, 6.37–6.38, Glossary

    • deposit takers, 6.27–6.38

    • households, 6.43–6.44

    • nonfinancial corporations, 6.43–6.44

    • other financial corporations, 6.39–6.42, 9.4–9.7

  • Consultation

    • with reporters, 11.14–11.15

    • with users, 11.16–11.17

  • Contingencies, 4.19–4.24, Glossary

  • Contingent items. See Off-balance sheets

  • Contingent liabilities, 4.21, Glossary

  • Core FSIs, 7.1–7.83

    • accounting principles, 7.3

    • calculation, 7.6–7.7

    • underlying series, 7.4–7.5

  • Corporations. See also specific types

    • legal or social entities, 2.6

    • predominant economic interest, 2.14

  • Cost fair value measurement approach, 4.42

  • Countercyclical buffer, 3.11, Glossary

  • CPPI. See Commercial Property Price Index (CPPI)

  • Credit conversion factors, 5.82, 5.88, Table 3.3

  • Credit equivalent amount, 3.34

  • Credit growth to private sector, 8.44–8.48, Glossary

  • Credit risk, 2.67, Glossary

    • Basel I capital requirement, 3.5, 3.6

    • Basel II standard approach, 3.8, 3.9

    • Basel II internal ratings-based approaches, 3.35

    • risk weighted assets, 3.32–3.35, Tables 3.2, 3.3

  • Credit unions and credit cooperatives, 2.37

  • Cross-border consolidation, 6.29, 8.37, 10.87, 10.93, Glossary

  • Cross-border, cross-sector,

  • domestically controlled (CBCSDC) data, 6.31, 6.34, Figure 6.2

  • Cross-border, cross-sector, domestically incorporated consolidation basis (CBCSDI), 1.19, 6.30, 6.32, 6.33, Figure 6.1

  • Cross-border, domestically incorporated (CBDI) consolidation basis approach, 9.5, 1.22

  • Cross-currency interest rate swaps, 5.57

  • Cross-sector consolidation, 6.28, Glossary

  • Customer deposits, 5.40, 8.28–8.32

D

  • Data compilation

    • dissemination practices, 11.21–11.33

    • managerial issues, 11.7–11.17

    • metadata, 11.34–11.36

    • practical issues, 11.18–11.20

    • strategic issues, 11.2–11.6

  • Data Gaps Initiative (DGI), 1.13, 12.2

  • Data quality, 11.7

  • Debt securities, 5.42, 5.49–5.51

  • Debt-service payments, 5.149

  • Deferred tax assets, 3.31, 3.20, Glossary

  • Defined benefit plan, 2.54

  • Defined contribution plan, 2.54

  • Deposit takers (DTs), 1.20, 2.19, 4.1, 4.2, 4.8, 9.6, Glossary

    • other deposit-taking corporations, 2.37

    • sectoral financial statements, 5.1, Table 5.1

      • balance sheets, 5.33–5.72

      • income and expense statement, 5.13–5.32, Table 5.1

      • memorandum series, 5.73–5.103, Table 5.1

  • Dissemination of FSIs

    • breaks in data series, 11.25–11.26

    • channels and practices, 11.21–11.23

    • deposit takers, 11.28–11.32

    • financial sector overview, 11.27

    • frequency and timeliness, 11.24

    • other financial corporations, 11.33

  • Distribution measures (DMs), 12.31

  • Displaced commercial risk (DCR), 7.99

  • Dollarization, Box 8.2

  • Domestic currency, 4.52–4.56, 5.37, 8.35, Glossary

  • Domestic location consolidation basis (DL), 6.35–6.36, Figure 6.3

E

  • Earnings before interest and tax (EBIT), 5.146, 10.32, Table 5.5

  • Earnings to interest and principal expenses, 10.31–10.35

  • Earnings to interest expenses, 10.36– 10.41, Box 10.5

  • Economic ownership. 4.7, Glossary

  • Economic territory, 2.8–2.9, Glossary

  • Effective interest rate, 4.14, 4.38

  • Employee stock options, 5.63

  • Encouraged indicators, 1.21

  • Equity-based or PLS contracts, 7.93

  • Equity investment, 6.13

  • Equity market, 2.66

  • Equity swaps, 5.57

  • Estimated pension payments, 5.133, 9.71

  • Exchange-traded contracts, 5.65

  • Expected credit loss (ECL), 4.25, 4.33, 5.27, 7.30, 7.41

  • Exposure at default (ED), 3.35, Glossary

  • External debt to equity, 10.13–10.16, Glossary

F

  • Fair value through other comprehensive income (FVOCI), 4.32, 4.44, 4.49

  • Fair value through profit or loss (FVTPL), 4.44, 4.49, 5.64

  • Financial assets, 1.18, 4.4, 4.5, Glossary

    • accrual accounting, 4.10–4.16

    • amortized cost, 4.37

    • arrears, 4.17–4.18

    • balance sheet, 5.35

    • classification, 5.36

    • contingencies, 4.19–4.24

    • provisions for loan losses and other impaired assets, 4.25–4.34

  • Financial auxiliaries, 2.57–2.58, Glossary

  • Financial corporations (FCs), 2.20, Glossary. See also specific types

    • Central bank, 2.30

    • Deposit takers, 2.31

      • Commercial banks 2.36

      • Special cases 2.38–2.43

    • Other financial corporations 2.44

      • Insurance corporations 2.47

      • Non-MMF investment funds 2.46

      • Pension funds 2.51

      • Other financial intermediaries 2.55

      • Financial auxiliaries 2.57

      • Captive financial institutions and money lenders 2.59

  • Financial derivatives, 2.56, 5.7, 5.36, 5.55

    • gross asset positions, 8.11–8.13

    • gross liability positions, 8.14–8.15 types, 5.56

  • Financial intermediaries. See Other financial intermediaries

  • Financial leasing companies, 2.56

  • Financial liabilities, 1.18, 4.4, 4.6

    • accrual accounting, 4.10–4.16

    • arrears, 4.17–4.18

    • balance sheets, 5.36

    • classifications, 5.36

    • contingencies, 4.19–4.24

  • Financial markets, 2.28, 2.62–2.63

  • Financial sector assessment program (FSAP) 13.26, Glossary

  • Financial soundness indicators (FSIs)

    • accounting principles (see Accounting principles)

    • compilation and dissemination, 1.13, 1.26, 11.2–11.36

    • core and additional, 1.1, Table 1.1

    • in macroprudential analysis, 1.2,

    • 1.27–1.30, 13.16–13.24, 13.25– 13.36, Box 13.1, Table 13.2

    • mapping from 2006, 1.30, Table 1.2

    • regional grouping of countries, 8.7, Box 8.1

  • Financial stability analysis, 1.21, 1.29

  • Foreign-controlled DTs, 6.20, 6.31, Glossary

  • Foreign currency, 7.3, 5.101, 10.17– 10.21, Glossary

  • Foreign currency debt to equity, 10.17–10.21

  • Foreign-currency-denominated liabilities, 8.39–8.43, Figure 8.1.2

  • Foreign-currency-denominated loans, 8.33–8.38, Figure 8.1.1

  • Foreign-currency-linked instruments, 4.53, Glossary

  • Foreign exchange markets, 2.62, 7.77–7.83, Table 7.1

  • Forward foreign exchange contracts, 5.56–5.57

  • Futures, forward-type contracts, 5.58

  • Funded pension schemes, 2.52–2.53

G

  • Gains and losses

    • financial assets, 5.116

    • on financial instruments, 5.19, 8.19

    • on loan sales, 5.21

  • General government, 2.18, 2.24–2.26, Glossary

  • General provisions/general loan loss reserves, 3.29

  • Geographical distribution of loans to total gross loans, 8.7–8.10

  • Gini coefficient, 12.15, Glossary

  • Global financial crisis (GFC), 3.40, 13.2, 13.46

  • Global note facilities (GNFs), 4.24

  • Gold swap, 5.45

  • Goodwill, 3.31, 5.81, 7.12, Glossary

  • Government units, 2.6

  • Gross disposable income, 5.154

  • Gross domestic product (GDP), 9.2, 9.20

  • Gross interest income, 5.15, Table 5.1

  • Gross recording, 6.5, Glossary

  • Group-consolidation, 6.1, 6.4, 11.11, Glossary

H

  • Hedge accounting, 4.14, 4.48, Glossary

  • Herfindahl-Hirschman index, 12.12, 12.16–12.17, Table 12.3, Glossary

  • High quality liquid assets (HQLA), 3.13, 3.49, 5.85, 7.71–7.72, Glossary

  • Holding companies, 2.61, 6.15, 6.17, Glossary

  • Households (HHs), 1.10, 1.24, 2.4, 2.18, Glossary

    • calculation of FSIs, 10.42–10.57

    • consolidation basis, 6.43–6.44

    • debt-service, 5.158

    • disposable income, 10.49–10.57

    • resident in economic territory, 2.13

    • sectoral financial statements, 5.12, 5.150–5.158, Table 5.6

  • HQLA. See High quality liquid assets (HQLA)

  • Hybrid pension schemes, 2.54

I

  • IDTs. See Islamic Deposit Takers (IDTs)

  • Income

    • interest income, 5.13

    • net income, 7.49–7.50

    • net income after tax, 5.117, 7.53, 9.67, 10.27

    • noninterest income, 5.16

    • operating income, 5.113, 5.136, 5.152

    • other comprehensive income, 3.27, 4.31–4.55, 5.19–5.21, 5.24, 5.30, 5.77

    • other income, 5.23

    • prorated earnings, 5.22

  • Income and expense statement, 5.5–5.6, Glossary

    • deposit takers, 5.13–5.32, Table 5.1

    • households, 5.152–5.153, Table 5.6

    • IDTs, 7.8, Table 7A.1

    • intra-group consolidation, 6.46, Table 6A.1

    • nonfinancial corporations, 5.136– 5.138, Table 5.5

    • other financial corporations, 5.104–5.133

      • insurance corporations, 5.110– 5.118, Table 5.3

      • money market funds, 5.106– 5.108, Table 5.2

      • pension funds, 5.124–5.127, Table 5.4

  • Income approach, 4.42

  • Institutional sectors, 2.2, 2.3, 2.10– 2.11, Glossary

  • Insurance corporations (ICs), 1.10, 1.22, 2.47, Glossary

    • balance sheet, 5.119–5.122, Table 5.3

    • FSIs, 9.40–9.68

    • income and expense, 5.110–5.118, Table 5.3

    • investment risks, 9.44

    • sectoral financial statements, 5.109, Table 5.3

    • shareholder equity to invested assets, 9.47–9.53

    • technical risks, 9.43

    • types, 2.47

  • Inter-Agency Group on Economic and Financial Statistics (IAG), 1.3

  • Interbank loans, 5.47

  • Interbank markets, 2.64, 8.25

  • Interest payments, 5.158, 10.37

  • Internal capital adequacy assessment process (ICAAP), 3.9

  • Internal ratings-based approach (IRB), 3.35, 3.36, Glossary

  • International Accounting Standard (IAS) 1, 5.6

  • International Accounting Standard Board (IASB), 4.1, Glossary

  • International Banking Statistics (IBS), 8.9, Glossary

  • International Financial Reporting

  • Standards (IFRS), 1.5, 4.1, 4.2, 5.3, Glossary

  • International Investment Position (IIP), 10.14, 10.19

  • Institutional Units, 2.2, 2.3, Glossary

  • Intra-group consolidation, 6.27, 6.36

    • balance sheets, 6.47

    • income statement, 6.46

    • issues associated with, 6.49–6.52

    • memorandum series, 6.48

  • Investment account holders (IAH), 7.96

  • Investment banks, 2.56

  • Investment equalization reserves (IRR), 7.96

  • Islamic bonds (Sukuk), 7.109

  • Islamic Deposit Takers (IDTs), 7.8, Table 7A.1

    • capital adequacy ratios, 7.95–7.100

    • CAS (see Capital adequacy standard (CAS))

    • finance business model, 7.90–7.93

    • financial soundness indicators, 7.101–7.104

    • financial statements, 7.105–7.110, Table 7A.1

    • financial system and structures, 7.85–7.89

    • mapping of financial statements, 7.105–7.110

    • Source and use of funds, 7.94, Box 7.3

  • Islamic Financial Services Board (IFSB), 7.89, 13.28

K

  • Kurtosis, 12.35–12.37, Figure 12.2, Glossary

L

  • Large exposures, 5.88, 8.3–8.6, Glossary

  • LCR. See Liquidity coverage ratio (LCR)

  • Lease-based contracts, 7.93

  • Legal ownership 4.7, Glossary

  • Lending, 8.10

  • Leptokurtic distribution, 12.37, Figure 12.2, Glossary

  • Leverage ratio, 3.46, Glossary

  • Liabilities, 5.7, Glossary. See also Financial liabilities

  • Life insurance corporations, 2.48

  • Life or long-term insurance, 2.47, 9.40, 9.47–9.53, 9.58–9.63

  • Liquid assets, 5.90, 5.132, 7.64–7.72, Glossary

  • Liquidation, 2.41

  • Liquidity, 2.68, 3.3, 13.8, Glossary

  • Liquid assets to short-term liabilities, 7.67–7.70, 12.6, 13.20

  • Liquidity coverage ratio (LCR), 3.13, 3.49–3.53, 7.67–7.72, 13.20, Glossary

  • Liquidity ratio, 9.70–9.74

  • Loans, 5.41

    • commercial real estate loans, 5.98

    • concentration by economic activity, 7.43–7.45, Box 7.2

    • foreign currency loans, 5.101

    • geographic distribution of loans, 5.100

    • loss provisions, 5.27

    • NPLs (see Non-performing loans (NPLs))

    • residential real estate loans, 5.97

  • Loss given default (LGD), 3.35, Glossary

M

  • Macroeconomic statistics, 2.1, 6.25

  • Macro-financial surveillance, 1.4

  • Macro indicators, 13.6

  • Macroprudential analysis, 13.1–13.46, Glossary

  • Macroprudential toolkits, 1.29, 13.15

  • Market-based indicators, 13.14

  • Market fair value measurement approach, 4.42

  • Market risk, 3.37–3.43

  • Maturity, accounting principles, 4.57–4.58

  • Maturity distribution of investments, 5.108, 9.27

  • Memorandum of understanding (MOU), 11.3

  • Memorandum series,

    • definition, Glossary

    • deposit takers, 5.73–5.103

    • households, 5.158

    • intra-group consolidation, 6.48, Table 6A.3

    • nonfinancial corporations, 5.145– 5.149

    • pension funds, 5.132–5.133

    • supervisory-based series, 5.74–5.88

  • Median, Tables 12.4, 12.5

  • Mesokurtic distribution, 12.37, Glossary

  • Metadata, 11.34–11.36

  • Micro-prudential 1.28, 13.4, 13.10– 13.13, Table 13.1

  • Minority interest, 6.13

  • MMFs. See Money market funds (MMFs)

  • Monetary policy, 2.30, 13.15

  • Money lenders, 2.59–2.61

  • Money market funds (MMFs), 1.10, 1.22, 2.33, Glossary

    • investment fund shares, 5.54

    • sectoral financial statements, 5.106–5.108, Table 5.2

  • Mortgage Servicing Rights, 3.31, Glossary

  • Multiple options purchase facilities, 4.24

  • Municipal credit institutions, 2.37

N

  • National accounts. See system of national accounts

  • National financial systems, 1.7

  • Net actuarial gains/losses, 5.126

  • Net asset value (NAV), 5.106

  • Net open position in foreign exchange, 7.77–7.83

  • Net recording, 6.5

  • Net stable funding ratio (NSFR), 3.13, 3.49, 3.54–3.55, 7.73–7.76

  • Net worth,

    • Households, 5.157

    • Non-financial corporations, 5.134

    • Pension fund, 5.131

  • NFCs. See Non-financial corporations (NFCs)

  • NIFs. See Note issuance facilities (NIFs)

  • Non-autonomous pension funds, 2.53

  • Non-bank DTs, 2.35

  • Non-financial assets, 4.4, 4.7, 4.39, 5.33, 5.141

  • Non-financial corporations (NFCs), 1.2, 1.23, 2.18, 2.23, 4.1, 10.5–10.8, Glossary

    • balance sheet, 5.139–5.144, Table 5.5

    • calculation of FSIs, 10.5–10.8

    • consolidation basis, 6.43–6.44, 10.4, 10.42–10.44

    • European Central Balance Sheet Data Offices, 10.6, Box 10.1

    • income and expense, 5.136–5.138, Table 5.5

    • memorandum series, 5.145–5.149, Table 5.5

    • quasi-corporations, 2.22

    • sectoral financial statements, 5.12, 5.134–5.135, Table 5.5

  • Non-financial liabilities, 4.4, 4.7

  • Non-interbank loans, 8.28–8.32

  • Noninterest expenses, 5.25, 7.60–7.63

  • Noninterest income, 5.16

  • Non-life insurance corporations, 2.49, 9.40, 9.54–9.57

  • Non-life or property and casualty insurance, 2.47

  • Non-MMF investment funds, 2.46, 5.54

  • Non-MMF mutual funds, 9.39, Glossary

  • Nonperforming loans (NPLs), 5.94–5.96, 13.19, 7.27–7.39, Glossary

    • arrears, 4.17–4.18

    • accrued interest on NPLs, 7.29, 7.30

    • classification of. 5.94–5.96

    • net of provision to capital, 7.27–7.33

    • to total gross loans, 7.34–7.38

    • provisions to nonperforming loans, 7.39–7.42

  • Non-profit institutions (NPIs), 2.6, 2.14, Glossary

  • Non-profit institutions serving

  • households (NPISHs), 2.18, Glossary

  • Non-resident unit, 2.14, 2.7, Glossary

  • Non-transferable deposits, 5.38

  • Non-unit linked insurance, 2.48

  • Note issuance facilities (NIFs), 4.24

  • NSFR. See Net stable funding ratio (NSFR)

O

  • OFCs. See Other financial corporations (OFCs)

  • Off-balance sheet exposures, 4.19, 4.20, 5.82, 5.84, 5.88, 7.25, Glossary

  • Off-balance sheet items, 3.46, 3.54, 4.32, 5.84, Table 3.3

  • Off-market swaps, 5.60

  • Offshore banks, 2.38–2.39

  • Operational risk, 3.44–3.45

  • Option contract, 5.61, 5.62

  • Original maturity, 4.57, Glossary

  • Other depository corporations (ODCs), 2.33, 2.37, Glossary

  • Other financial assets, 5.29, 5.66

  • Other financial corporations (OFCs), 1.22, 2.19, Glossary

    • calculation of FSIs, 9.8–9.11

    • captive financial institutions, 2.59–2.61

    • consolidation basis, 6.39–6.42, 9.4–9.7

    • financial auxiliaries, 2.57–2.58

    • insurance corporations, 2.47–2.50, 5.109–5.122, 9.40–9.68

    • money lenders, 2.59–2.61

    • money market funds, 2.45, 5.106– 5.108, 9.24–9.39

    • non-MMF investment funds, 2.46

    • other financial intermediaries, 2.55–2.56

    • pension funds, 2.51–2.54, 5.123– 5.133, 9.69–9.80

    • relative size, Box 9.1

    • sectoral financial statements, 5.104–5.105

  • Other financial intermediaries, 2.55–2.56

  • Other operating expenses, 5.114

  • Other operating income, 5.113

  • Other Shariah-compliant securities, 7.92

  • Overdrafts, 2.30

  • Over-the-counter (OTC) trading, 5.58

P

  • Pension funds (PFs), 2.51–2.54

    • autonomous, 2.53

    • balance sheet, 5.128–5.131

    • FSIs for OFC, 9.69–9.80

    • income and expense, 5.124–5.127, Table 5.2

    • memorandum series, 5.132–5.133, Table 5.2

    • other financial corporations, 2.51–2.54, 5.12, Table 5.2

    • sectoral financial statements, 5.123, Table 5.2

  • Pension schemes, 1.10, 2.51, 2.52, 5.155

  • Personnel costs, 5.26

  • Platykurtic distribution, 12.37, Glossary

  • Potential future exposures, 7.25

  • Price discovery, 2.28

  • Principal or interest payments, 4.17, 5.158

  • Probability of default (PD), 3.35

  • Profit and loss sharing (PLS) arrangements, 7.92

  • Profit revaluation of own debt, 3.31

  • Profit sharing investment accounts (PSIA), 7.90, 7.99–7.100

  • Prorated earnings, 5.22

  • Prudential and Structural Indicators for Islamic Financial Institutions-PSIFIs, 7.102– 7.103, 13.28

Q

  • Quasi-corporations. See Unincorporated enterprises

R

  • Real estate markets, 10.58–10.95

    • financial soundness indicators, 10.73–10.95

    • measurement, 10.62–10.72

    • price indices, 10.62–10.72

  • Regulatory capital, 3.4, 3.16–3.31, 5.75, 5.82

    • definition, Glossary

    • accounting equity, 3.17

    • capital and reserves 5.82

    • adjustments to regulatory capital, 3.31

    • Basel Accord, defined, 3.23

    • Common equity Tier 1 (CET1) capital, See Common equity Tier 1 (CET1) capital

    • intangible assets, 3.20

    • risk-weighted assets, 7.9, Table 7.1

    • Tier 1 capital, See Tier 1 capital

    • Tier 2 capital, See Tier 2 capital

  • Reinsurance corporations, 2.47, 2.50

  • Repurchase agreement, 5.38, 5.41, See securities repurchase agreement

  • Required stable funding (RSF), 3.55, 7.73

  • Residence, 2.7, 2.10–2.11

  • Residency-based approach, 6.44

  • Residential Property Price Index (RPPI), 1.25, 10.62, 10.66– 10.68

  • Residential real estate loans, 5.97, 10.84–10.89

  • Residential real estate prices, 10.74–10.78

  • Resident institutional units, 2.18, 2.25

  • Residual maturity, 4.58

  • Retained earnings, 5.71

  • Return on assets (ROA), 7.46–7.50, 9.58–9.63, 9.75–9.80, 12.41, Figure 12.4

  • Return on equity (ROE), 7.51–7.55, 9.64–9.68, 10.26–10.30

  • Revolving underwriting facilities (RUFs), 4.24

  • Riba, 7.85

  • Risk dashboard, 13.30–13.31

  • Risk-weighted assets (RWAs), 3.4, 4.30, 5.82

  • ROA, See Return on assets

  • ROE, See Return on equity

  • RPPI. See Residential Property Price Index (RPPI)

  • Rural banks, 2.37

S

  • Sale-based contracts, 7.93

  • Savings and loan associations, 2.37

  • Sectoral analysis, 9.31

  • Sectoral balance sheet, 5.83, 5.139– 5.144, Table 5.1

  • Sectoral distribution of investments, 5.107, 9.27

  • Sectoral financial statements, 5.10– 5.149, Table 5.2–5.6

  • Securities repurchase agreement (repo), 5.44

  • Securitization vehicles, 2.56

  • Sales of goods and services, 5.136

  • Shadow banking, 1.2, 2.44

  • Shareholder equity, 9.51

  • se equity, 5.143

  • Shariah principles, 7.85–7.86

  • Short-term liabilities, 5.93

  • Short-term maturity, 1.17

  • Skewness, 12.31–12.34, Figure 12.1, Glossary

  • SLDR. See Spread between reference lending and deposit rates (SLDR)

  • Specialized financial intermediaries, 2.56

  • Specific loan loss provisions, 5.48

  • Spread between highest and lowest interbank rates, 8.25–8.27

  • Spread between reference lending and deposit rates (SLDR), 8.23–8.24

  • Stable funding, 5.87, Glossary

  • Standardized report forms (SRFs), 10.19

  • Standardized guarantee schemes, 5.155

  • Statement of financial position. See Balance sheets

  • Statistical Data and Metadat eXchange Standard (SDMX), 11.21

  • Subsidiaries, definition of, 6.11

  • Supervisory-based memorandum series, 5.74–5.88

  • Supervisory deductions, 5.76, 5.80

  • Swap contracts, 5.57

  • Stress testing, 13.14, 13.26, 13.33–13.35

  • Systemically important financial institutions (SIFIs), 13.12

  • System of national accounts (SNA), 5.1, Box 5.1

T

  • Tail risk, 1.10, 3.41, 12.2, 12.4

  • Term insurance, 2.48

  • Threshold deductions, 3.31

  • Tier 1 capital, 3.23–3.26, 5.76, 7.23–

  • 7.26, 12.39, Figure 12.3, Annex 3.1, Glossary

  • Tier 2 capital, 3.23, 3.24, 3.29, 3.30, 5.78, Annex 3.1, Glossary

  • Tier 3 capital, 5.79, 6.65, Annex 3.1

  • Top-down stress testing, 13.34

  • Total debt

    • to equity, 10.9–10.12

    • in foreign currency, 5.148, 10.17

    • to GDP, 10.22–10.25, Box 10.3

    • to non-residents, 5.147, 10.14

  • Total financial system assets, 9.9–9.18, Box 9.1

  • Total household debt (or liabilities), 5.156

  • Total net cash outflows, 5.86, Glossary

  • Total other comprehensive income, 5.24, 5.106, 5.118, 5.127

  • Trade credit and advances, 5.67, 5.142. See also Non-financial corporations (NFCs)

  • Trading income, to gross income, 8.16–8.19, Annex 8.1

  • Transaction costs, 4.44

  • Transferable deposits, 5.38

  • Turnover, 2.66

U

  • Underwriters and dealers, 2.56

  • Undisclosed reserves, 3.29, 7.12

  • Unfunded pension schemes, 2.52

  • Unincorporated enterprises, 2.14, 5.150, 5.154

  • Unit of account, 4.55

  • Unit-linked insurance, 2.48, 5.115, 5.116

  • Unrestricted Mudaraba, Box 7.3

  • Unsecured subordinated debts, 3.29, 3.30

V

  • Valuation, accounting principles, 4.35–4.48

    • amortized cost and fair value, 4.36–4.43

    • derivatives and hedge accounting, 4.47–4.48

    • transactions, 4.44–4.46

  • Value at risk (VaR) estimation, 3.39, Glossary

  • Venture capital and private equity firms, 2.56

  • Volatility

    • defined, Glossary

    • in other comprehensive income, 5.20

    • of bid-ask spreads, 5.29

    • of deposits, 5.39

W

  • Wages and salaries, 5.26, 5.66, 5.152, Table 5.6

  • Weighted average interest rates, 8.49–8.57

  • Weighted kurtosis, 12.31, 12.35–12.37

  • Weighted quartiles, 12.23–12.29, Box 12.1

  • Weighted standard deviation, 12.20– 12.22, 12.42, Figure 12.4

  • Weighted skewness, 12.31, 12.32–12.34

  • Weighted medians, Table 12.4

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