Document ID: chunk:federal_register_of_legislation:F2022L00227:body:0:p9
Version: federal_register_of_legislation:F2022L00227
Segment Type: other
Provision Reference: 
Character Range: 23767–26923

classified as property exposure.

     * Rural exposures will generally not meet the definition of commercial property, unless the property has been acquired specifically for lease or resale, and where the servicing of the debt is dependent on such lease or resale (and/or the lease or resale of other properties).

     * Facilities to investment companies, property management companies and unit trusts whose success in business (and therefore the servicing and repayment of the debt) is predominantly dependent upon the performance of the property market are included in commercial property exposure.

     * Facilities provided for the acquisition of property to be used for generating income other than through rental or sale are classified under the industry from which the cash flow servicing the debt is derived. In such owner-occupied properties where part of the debt servicing is derived from rental income, the classification depends on the predominant source of debt servicing. If most of the servicing is by way of income derived from the owner's business, the exposure is classified under that business. However, if most of the servicing derives from the property itself, it is a property exposure.

The Australian and New Zealand Standard Industrial Classification (ANZSIC) codes may be used as a guide. Although ANZSIC was not developed for this purpose, property exposures will generally be to enterprises classified under ANZSIC 771 (Property Operators and Developers), and exclude those under subdivision 57 (Accommodation, Cafes and Restaurants).  Also excluded are loans to enterprises classified under subdivision 41 (General Construction) unless they assume the development risk, as described above.

The complete ANZSIC listing is an Australian Bureau of Statistics (ABS) publication (Catalogue No. 1292.0) – February 2006.

Specific instructions

Part A – Commercial property

Total exposure limits

When calculating total exposure limits, do not include internal limits, which have not been formally advised to a client and may be cancelled at the reporting ADI's discretion.

Total actual exposures

When calculating total actual exposures, the exposure should include:

     * claims and commitments recorded on-balance sheet; and

     * the credit equivalent amounts of off-balance sheet claims and commitments.

Non-performing exposures

The definition of non-performing exposures should be consistent with the methodology used to compile the information for Reporting Standard ARS 220.0 Credit Exposures and Provisions. Specific provisions and security held against these exposures are also requested.

Commercial property classifications

The information required for total exposure limits, total actual exposures, non-performing exposures (balance outstanding, specific provisions & security held) are to be classified according to the type of commercial property market/categories to which the ADI is exposed. The categories that the exposures are to be classified in this form are listed below:

     1. office;

     2. retail – includes retail shops, restaurants, shopping centres, petrol stations,