Investor Presentaiton
HSBC SFH
Programme features - Asset Cover Test
The Asset Cover Test (ACT) 31 is designed to ensure that the collateral constituted by home loans, cash and other
collateral is able to meet the future cash flows (interest and principal) on the covered bonds (performed monthly by
the calculation agent)
Asset Cover Ratio
Whereby
Adjusted Aggregate
Asset Amount
||
Adjusted Aggregate Asset Amount
Aggregate Covered Bond Outstanding Principal Amount
Lower of:
Adjusted Home Loan Outstanding Principal Amount
And
(Sum of all Unadjusted Home Loan Outstanding
Principal Amounts - Applicable Deemed reductions)
Asset Percentage
Less
IV
Cash
+
Aggregate
Plus
Eligible Substitution
Assets Amount
+
Aggregate Value of
Permitted Investments
Zero Or Potential financing costs of the swap
Plus
Weighted Average Maturity x Covered Bond Outstanding Principal Amount x Carrying Cost
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