| Commentary

46 Large exposures

| Commentary

46 Large exposures1

It is the responsibility of each building society’s board to set its own limits for large exposures, within the framework set by the Banking Consolidation Directive (BCD)2 and the rules and guidance given by the Financial Services Authority (FSA). The limits set out in the Interim Prudential Sourcebook for Building Societies (IPRU (BSOC)) 7 are maxima, and each building society should set its own prudential limits both to avoid over-concentration of risk3 and to allow a margin for manoeurvre so as to ensure that the limits can never be exceeded4.

In accordance with the BCD, the FSA has

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