PET - Plain English Taxonomy

Attribute: CS06000
Concept:
Label: Other Derivative Contracts - WrittenOptionPositions - BoughtProtection
Concept Guidance:
This is the value, as at the relevant date, of bought credit derivative contracts, consistent with the classification and measurement basis used for derivatives by institutions in accordance with accounting standards.A bought credit derivative is a credit derivative that has been purchased by an entity. A credit derivative enables the user to transfer the credit risk of an underlying asset from one party, the protection buyer, to another, the protection seller, in isolation from other risks.Derivatives are generally defined as those instruments/contracts, where the value is based on other products, and/or on prices associated with financial products. 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).Report this item regardless of whether favourable or unfavourable to the reporting entity. 
Form-Specifc Guidance:
An ADI may net claims and obligations arising from market-related contracts across both the banking and trading books with a single counterparty if covered by eligible bilateral netting agreements (refer to AGN 112.3 for details on how to calculate the credit equivalent amount of these contracts).
Report only those contracts that give rise to off-balance sheet credit exposures in the credit equivalent amount column. ADIs may refer to APRA where they are unclear as to which category is appropriate for a particular market-related transaction when calculating the credit equivalent amount of that transaction for capital adequacy purposes.

Exemption from capital weighting is permitted for:
- foreign exchange (except gold) contracts that have an original maturity of 14 calendar days or less; and
- instruments traded on futures and options exchanges that are subject to daily mark-to-market and margin payments.
Market risk charge of market-related contracts held in the trading book will be captured under the Market Risk Form. 

While not intended as an exhaustive list, other derivative contracts may include the following:
- swaps;
- forwards;
- purchased options;
- similar derivative contracts based on precious metals such as gold, silver, platinum and palladium;
- energy contracts;
- agricultural contracts;
- base metals (such as aluminium, copper and zinc);
- other non-precious metal commodity contracts; and
- any contracts covering other items, that give rise to credit risk.

Netting should not be applied when reporting amounts within the Statement of Derivative Activity.
Dimensions
Dimension Member Description
(TradingBook)
This dimension categorises an Authorised Deposit-taking Institution's holdings of financial instruments based on the 'book type' ('Banking Book' or 'Trading Book') to which the instrument belongs, as determined in accordance with relevant prudential standards.
The information reported relates to an Authorised Deposit-taking Institution's holdings of financial instruments in the trading book, as agreed with APRA.
(NotionalPrincipalAmount)
This dimension categorises the reported data according to the measurement scenario under which the reported value was calculated.
The value reported is the notional principal amount. The notional principal amount represents the face value, or gross amount, of an off-balance sheet transaction.This does not represent the fair value.
(NotRecognisedExchange)
This dimension categorises the reported data according to the channel or medium through which investments are made.
These are investments that are not made through a recognised exchange for the products being transacted. These are typically referred to as "Unlisted" or "Over The Counter (OTC)" investments.