26 Bonds Provisioning

Under provisioning, banks have to set aside funds to a prescribed percentage of their non-performing or bad assets. The amounts set aside are based on estimates of anticipated future losses.

Securities module supports provisioning of debt instruments and other fixed-income exposures for a combination of security Id and portfolio Id through the manual provision processing.

Dedicated separate GLs are used to pass entries of provisioning at the portfolio level. Only liquidated deals having deal nominal balance amount are taken into consideration for provisioning.

The system can perform Reverse Provisioning once the debt security is reclassified as performing. The full provision made will be reversed if the action Reverse Provisioning is performed.

This topic contains the following subtopics:

• Securities Security Product Definition
  This topic describes the systematic instruction of Securities Security Product Definition.
• Securities Manual Provision
  This topic describes the systematic instruction to perform securities manual provision.
• Securities Provisioning Summary
  This topic describes the provision summary details.
• Securities Instrument Definition
  This topic describes the systematic instruction to capture the others tab details in securities instrument definition screen.