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NEW ZEALAND GAZETTE, No. 35

11 FEBRUARY 2005

“Credit Exposure” means the amount of the maximum loss that a party to a contract could incur as a result
of the Counterparty to that contract failing to discharge its obligations, without taking into account the value
of collateral, guarantees, indemnities, other support arrangements, and any potential recoveries, where the maximum
loss in relation to:
(a) a market related contract means the credit equivalent amount of the contract determined in accordance with
the Reserve Bank document entitled Capital Adequacy Framework (BS2) as amended from time to time;
(b) any other contract means the full value of the contract;
provided that, for the purposes of this definition, a Financial Liability and a Financial Asset may be offset if to do so
would accord with generally accepted accounting practice as defined in the Financial Reporting Act 1993.

“Credit Risk” has the same meaning as in FRS-33, as amended from time to time.

“Currency Risk” has the same meaning as in FRS-33, as amended from time to time.

“Debt Security”, in relation to a Registered Bank, means any interest in or right to be paid money that is, or is to be,
deposited with, lent to, or otherwise owing by, that Registered Bank (whether or not the interest or right is secured by a
charge over any property).

“Director” means a person holding office as a director of the Registered Bank.

“Direct Banking Account” means a bank account held at a branch that is not normally physically accessible by the
customers of that branch.

“Disclosure Statement”, in relation to a Registered Bank, means a document Published by that Registered Bank under
sections 81 or 83 of the Act which shall comprise a General Disclosure Statement, Key Information Summary and
Supplemental Disclosure Statement.

“Equity” has the same meaning as in the Institute of Chartered Accountants of New Zealand Statement of Concepts for
General Purpose Financial Reporting as amended from time to time.

“Equity Exposure” means the amount of the change in the economic value of equity instruments that are Financial Assets
and Financial Liabilities of the Banking Group in a single currency, which would occur as a result of a change in the
price of equity instruments in that currency.

“Equity Risk” means the risk arising from changes in the prices of equity instruments.

“Fair Value” has the same meaning as in FRS-33, as amended from time to time.

“Financial Asset” has the same meaning as in FRS-33, as amended from time to time.

“Financial Instrument” has the same meaning as in FRS-33, as amended from time to time.

“Financial Liability” has the same meaning as in FRS-33, as amended from time to time.

“Financial Reporting Group” means a Registered Bank (as reporting entity) and all other entities included in the group as
that term is defined in section 2 (1) of the Financial Reporting Act 1993.

“Foreign Currency Exposure” means the amount of the change in the economic value of the Financial Assets and
Financial Liabilities of the Banking Group in a single foreign currency which would occur as a result of a change in the
rate of exchange applicable to that foreign currency.

“General Disclosure Statement” means that part of a Disclosure Statement which contains the information prescribed in
Part III and Part IV of this Order.

“General Provision” has the same meaning as in FRS-33, as amended from time to time.

“Group of Closely Related Counterparties” has the same meaning as in FRS-33, as amended from time to time.

“Immediate Relative”, in relation to any person, means their spouse, civil union partner, or de facto partner (as defined in
the Property (Relationships) Act 1976), and any parent, brother, sister or child, in each case whether or not adoptive, of
that person or of their spouse, civil union partner, or de facto partner.

“Impaired Asset” means a Non-Accrual Asset, a Restructured Asset, or an Asset Acquired Through the Enforcement of
Security.

“Independent Director” has the same meaning as in the Conditions of Registration.

“Insurance Business” has the same meaning as in the Conditions of Registration.

“Interest Rate Exposure” means the amount of the change in the economic value of the Financial Assets (excluding
equity instruments) and Financial Liabilities (excluding equity instruments) of the Banking Group in a single currency
which would occur as a result of a change in interest rates in that currency.

“Interest Rate Repricing Date”, as that term applies to a Financial Instrument or to a proportion of a Financial Instrument,
means the earlier of the date on which, in accordance with the terms of the Financial Instrument:
(a) the interest rate reset date next occurs (being the date on which the rate of interest payable in respect of the
Financial Instrument can or will alter); or
(b) the principal sum is due and payable or, where no principal sum is due and payable, the maturity date occurs.

“Interest Rate Risk” has the same meaning as in FRS-33, as amended from time to time.

“Interim Accounting Period” means, subject to the application of subclause 2 (6), the first six month period of an
Accounting Period.

“Investment Security” has the same meaning as in FRS-33, as amended from time to time.

“Issuer” has the same meaning as in the Financial Reporting Act 1993.

“Key Information Summary” means that part of a Disclosure Statement which contains the information prescribed in Part
II of this Order.

“Market Risk Exposure” means exposure to any, or all, of Equity Exposure, Foreign Currency Exposure and Interest
Rate Exposure.