5. Policy Requirements
| No: 44047144 | Date(g): 27/12/2022 | Date(h): 4/6/1444 |
Effective from Jan 01 2023 - Dec 31 2022
To view other versions open the versions tab on the right
| 5.1 | The Leverage ratio is defined as the capital measure (the numerator) divided by the exposure measure (the denominator). This ratio should be expressed as a percentage. | ||||
 | |||||
| 5.2 | Capital measure for Leverage ratio is Tier 1 regulatory capital1, which include common equity Tier 1 and Additional Tier 1 Capital as defined in in the Finalized Guidance Document Concerning the Implementation of Basel III issued by SAMA circular No. 341000015689 Dated 19 December 2012 and any subsequent adjustments. | ||||
| 5.3 | The exposure measure for the Leverage ratio should generally follow gross accounting value unless different treatment is specifically mentioned in this framework. | ||||
| 5.4 | Exposure measure should include the following exposures: | ||||
| (i) | On-balance sheet exposures (excluding on-balance sheet derivative and securities financing transaction exposures); | ||||
| (ii) | Derivative exposures; | ||||
| (iii) | Securities financing transaction (SFT) exposures; and | ||||
| (iv) | Off-balance sheet (OBS) items. | ||||
| 5.5 | The leverage ratio (Capital measure and Exposure measure) must be calculated and reported to SAMA on a quarter-end basis. | ||||
| 5.6 | Banks' Leverage ratio must be at least 3% at all time. | ||||
1 In other words, the capital measure used for the Leverage ratio at any particular point in time is the Tier 1 capital measure applicable at that time taking into consideration all regulatory adjustments allowed by SAMA from time to time.