Investor Presentaiton
MORGAN STANLEY BANK ASIA LIMITED
NOTES TO THE FINANCIAL STATEMENTS
Year ended 31 December 2020
24.
FINANCIAL RISK MANAGEMENT (CONTINUED)
Credit risk (continued)
Collateral and other credit enhancements (continued)
At 31 December 2020, the carrying amount of financial assets on which no ECL were recognised because
of collateral held was US$3,368,801,000 (2019: US$2,770,325,000).
The Company closely monitors collateral held for financial assets considered to be credit-impaired, as in
such cases it is considered more likely that the Company will take possession of collateral to mitigate
potential credit losses.
The Company does not hold financial assets considered to be credit-impaired.
Exposure to credit risk by class
Class
Subject to ECL:
31 December 2020
Gross credit
exposure
US$'000
Credit
(1)
enhancements
US$'000
Net credit
exposure
US$'000
Gross credit
exposure
US$'000
(1)
31 December 2019
Credit
enhancements
Net credit
exposure
US$'000
US$'000
Cash and short-term
deposits
1,256,705
1,256,705
633,898
633,898
Loans and advances (3)
3,438,202
(3,368,801)
Investment securities
2,616,724
69,401
2,616,724
2,770,325
854,769
(2,770,325)
854,769
Trade and other
receivables(2)
88,733
88,733
62,570
62,570
Not subject to ECL:
Trading financial
assets:
Derivatives
1,709
Secured financing
582,265
7,984,338
(1,709)
(578,129)
(3,948,639)
441
4,136
4,035,699
362,047
4,684,050
(441)
(359,010)
(3,129,776)
3,037
1,554,274
Unrecognised
financial instruments
Not subject to ECL:
Unsettled securities
purchased under
agreements to
resell(4)
51,800
(1) The carrying amount recognised in the statement of financial position best represents the Company's maximum
exposure to credit risk.
(2) Trade and other receivables include cash collateral pledged against the payable on OTC derivative positions.
These derivative liabilities are included within trading financial liabilities in the statement of financial position.
(3) The collateral held as security for loans and advances consists of cash of US$811,426,000 (2019:
US$529,704,000), securities of US$1,748,866,000 (2019: US$1,019,982,000) and other collateral of
US$808,509,000 (2019: US$1,220,639,000).
(4) For unsettled securities purchased under agreements to resell, collateral in the form of securities will be received
at the point of settlement. Since the value of collateral is determined at a future date, it is currently
unquantifiable and not included in the table.
39
51,800View entire presentation