Document ID: chunk:federal_register_of_legislation:F2023L01572:front:0:p21
Version: federal_register_of_legislation:F2023L01572
Segment Type: other
Provision Reference: 
Character Range: 54019–57013

an exposure) as a result of a representation or warranty. In such a case the repurchase or replacement must be:
(i)            completed in all respects within 120 days of the transfer of exposures in a securitisation; and
(ii)         conducted on the same terms and conditions as the original transfer;
(c)          for securitisation transactions that include a clean-up call:
(i)            the exercise of the call must be at the full discretion of the originating ADI;
(ii)         the call must not be structured to avoid allocating losses to credit enhancements provided to the SPV or its investors, or positions held by investors or otherwise structured to provide credit enhancement; and
(iii)       the call must only be exercisable when 10 per cent or less of the original underlying portfolio or securities issued remains outstanding;[35]
(d)          for securitisation transactions that include a date-based call:
(i)            the call relates to senior securities only;
(ii)         the call date is set at the time the securities are issued;
(iii)       the exercise of the call is at the full discretion of the originating ADI; and
(iv)        the call is not structured to avoid allocating losses to credit enhancements provided to the SPV or its investors, or positions held by investors or otherwise structured to provide credit enhancement;
(e)          in a self-securitisation, where the repurchase (or replacement) is to meet a security's eligibility for purchase under the repurchase agreement with the RBA.
6.             In the case of paragraph 5(b) of this Attachment, after the expiry of the 120-day period an ADI must notify APRA of any instance where it has agreed to pay damages arising out of representations and warranties or where it has agreed to reassume the credit risk of any exposures. Should APRA consider that the basis for, or the amount of damages paid, or assumption of credit risk by the ADI constitutes implicit support, the provisions of paragraphs 69 to 71 of this Prudential Standard will apply.
7.             In the case of paragraphs 5(c) and 5(d) of this Attachment, an originating ADI must have regard to APS 210. An ADI must address the liquidity risk associated with clean-up and date-based call options through its liquidity risk management framework to measure, monitor and manage the relevant liquidity risk.

Securitisation of revolving credit facilities

Revolving period of securitisation
8.             An originating ADI's seller interest in the underlying exposures may have different principal allocation to other senior securitisation exposures but must not be subordinated with respect to cash flows (e.g. interest payments and expenses) and any losses associated with the underlying exposures.

Scheduled or early amortisation and similar provisions
9.             Scheduled amortisation or early amortisation and similar provisions, if triggered, must not:
(a)          subordinate the originating ADI's seller interest