Module 8 Prudential Information Guidance

Summary

This is detailed guidance from the Guernsey Financial Services Commission explaining how banks should complete Module 8 (Prudential Information) of the BSL/2 prudential return. It defines the specific data items banks must report, including connected-party deposits and loans, large exposures, off-balance sheet items and derivatives, and complaints statistics. It does not itself create new prudential rules but clarifies how existing BSL/2 reporting fields should be populated.

• Memorandum items: Guidance on reporting group company and connected-party deposits and loans, encumbered assets, ten largest market loans/bank guaranteed loans, ten largest non-bank depositors, and complaints statistics.
• Large exposures (branches): Branches report the ten largest credit exposures to the non-bank sector using the unchanged Large Exposures worksheet, excluding loans under £50,000.
• Large exposures (subsidiaries): Subsidiaries must complete four separate worksheets: LEs - Clients, LEs - Third Party Banks, LEs - Sovereigns, and Upstreaming - Parent and Group, capturing exposures exceeding 10% of net capital base and flagging related-party exposures.
• Off-balance sheet items and derivatives: Banks must categorise off-balance sheet exposures (direct credit substitutes, transaction- and trade-related contingencies, asset sales with recourse, forward asset purchases, note issuance/underwriting facilities, other commitments) into standard reporting items.
• Grandfathering: Exposures already in existence as at 30 June 2014 can be grandfathered through to their expiry date without needing to conform to the large exposure policy that took effect on that date.

The guidance is a completion aid for an existing regulatory return rather than a standalone rulebook; obligations flow from the underlying BSL/2 return requirement and the Commission's Large Exposures Policy (effective 1 July 2014) and the Banking Supervision (Bailiwick of Guernsey) Law, 1994, both referenced throughout.

Key obligations

• Banks must report deposits and loans from group companies, directors, controllers and their associates, and connected non-group companies in the Prudential Information module.
• Branches must list the ten largest money market placements or bank-guaranteed loans by name, amount and maturity date, with no de minimis exclusion.
• Banks must report the ten largest non-bank depositors, including whether each is a related party.
• Subsidiaries must report on four separate Large Exposures worksheets (Clients, Third Party Banks, Sovereigns, Upstreaming) any exposure exceeding 10% of net capital base, including on- and off-balance sheet components.
• Banks must report complaints received in the last quarter and calendar year to date, and flag significant complaints as defined in the Licensees (Conduct of Business) Rules 2014.
• Banks must categorise and report off-balance sheet exposures and derivatives into the standard items (M.1 to M.9b) with total amounts for each.

Applies to

banks, branches of banks, subsidiary banks, licensed deposit-taking institutions