Provision Matrix

The Provision Matrix subprocess is separated into two tasks:

• Allowance Calculation
• Provision Calculation

In the Allowance Calculation task, the application uses the Provision Matrix method to calculate the Allowance for all accounts classified under the provision matrix methodology and accounts for which Allowance calculation was skipped by previous methods. This calculation is done on the Carrying Amount or the drawn amount. That is, the Allowance calculation is formulated using the Carrying Amount and Provision Rate.

In the Provision Calculation task, the application uses the Provision Matrix method to calculate the Provision for all accounts that have an undrawn portion. This calculation is done on the undrawn amount. The Provision is calculated using Undrawn Amount, Credit Conversion Factor (CCF), and Provision Rate.