Indirect exposure definition
Indirect exposure means an exposure to a counterparty of a reporting institution that arises from the counterparty providing credit protection to the reporting institution’s other exposures.
Indirect exposure. – means an exposure created when a person other than the recipient of a loan agrees or is otherwise legally obligated to repay the debt in the event that the primary obligor/s defaults or is unable to repay the debt; an example of indirect debt is the exposure created when one person guarantees loans advanced to another person; the recipient of the loan proceeds is the 'primary' obligor and the person guaranteeing the loan is the 'secondary' obligor although both persons may be equally liable under the law to repay the obligation.
Indirect exposure means an exposure to a counterparty of an AI that arises from the counterparty providing credit protection to the AI’s other exposures;