Competencia digital (CD)

Deal-related data can be classified into three groups basically:

34 _{If a particular identification number already exists in the system, then it will be treated not as a new}

▪ basic data,

▪ data in connection with the claims derived from the deals, and ▪ recovery and loss data.

The data which constitute the first group (Table 2) are already known at the start of the deal, so these are to be recorded at that time in the framework of data registering of the bank, and do not change regularly later on, except for some special cases, for example restructuring.

These basic data are historically available for each bank, and recording of them in the internal bank systems usually possess long foregoing. Perhaps the statement of client type means exception to this characteristic, so the filling in of this field is not compulsory because of this reason.35

Table 2: Basic data of deals

CONTENTS OF THE FIELD Central deal

identification number

Hidden random individual code for identifying the deal, which is generated by the central database manager system.

The bank’s deal identification number

Individual deal identification number which is generated and applied by the bank.

Product type Product type of the deal depending on the loan purpose of the client. Possible code values:

1: Home purpose – Buying, 2: Home purpose – Building,

3: Home purpose – Renovation, enlargement, other, 4: Free use.

Currency 3-character length ISO code which identifies currency of the deal at disbursement.

Client type* Client type of the borrower. Possible code values: 1: Private individual, 2: Individual entrepreneur. Date of

disbursement If the disbursement occurs in details than the date of the first subpayment, else the only date of disbursement. Disbursed amount in

original currency

Disbursed amount for the client, given in the original currency of the deal. If the disbursement occurs in details than the sum of disbursed subpayments.

*: Filling in is not compulsory. (Self-made table) The following group of data (Table 3) includes the capital, interest and other claims in connection with the deals at default event and at denunciation. These pieces of information about exposures are applied in the course of calculating recovery rate directly.

35 _{The basic idea in the course of development of the Database was that in order to achieve the largest}

possible quantity of deals the filling in of every field has to be optional, which can not probably be served on the basis of the internal bank systems which reflect the historical data collecting culture.

Table 3: Data in connection with the claims derived from the deals

CONTENTS OF THE FIELD Date of default event Date of getting into default status.

Capital claim at

default event Capital claim at default event, given in domestic currency (HUF). Interest claim at

default event

Interest claim at default event, given in domestic currency (HUF). Other claim at

default event Late interest, fee, charge and other claim at default event, given in domestic currency (HUF). Date of denunciation Date of getting into denunciated status.

Capital claim at

denunciation Capital claim at denunciation, given in domestic currency (HUF). Interest claim at

denunciation Interest claim at late interest, fee, charge and other due at default event, given in domestic currency (HUF), given in domestic currency (HUF). Other claim at

denunciation Late interest, fee, charge and other claim at denunciation, given in domestic currency (HUF). (Self-made table) In the practice of banks, there can be notable differences between putting the deals into defaulted or denunciated status,36 furthermore small-scale temporal changes may occur for particular banks as well.

Considering the fact that data uploading passes anonymously, there is no way to retrieve information from the database directly concerning the proper reason behind the changing of average duration between date of default event and denunciation:

▪ the particular banks, in consequence of changing in their workout policy, denunciate their defaulted loans in shorter / longer time than previously, and/or ▪ the compound of the portfolio performed in the Database changed in a way that

the banks which apply generally faster / slower denunciation period represent larger proportion lately.

The third group of deal-related data (Table 4) serves as particular input for calculating the recovery rate as well, since recovery and cost data are performed in it.37 Although the emergence date of these latter ones do not appear explicitly, according to the practical experiences this is not significantly different from the date of recoveries, as the most considerable costs arise usually simultaneously with the recoveries or shortly before.

36 _{Since this is not prescribed by regulations particularly, it serves only as indication.}

37 _{The amounts are to be recorded in Hungarian Forint in this case also, irrespectively of the original}

Table 4: Recovery and loss data in connection with the deals

CONTENTS OF THE FIELD Selling price of the

debt* Real selling price of the debt in case of factoring, given in domestic currency (HUF). Amount of other

recovery** Sum of other recoveries from a deal which came in following the denunciation, given in domestic currency (HUF), excluding recoveries from selling the collateral.

Date of other

recovery** Date of the coming in of the latest other recovery.

Collection cost Sum of the direct costs pertaining to the deal following the denunciation, for example distraint costs, excluding the wage costs of the bank’s staff and the allocated other general costs.

Own factor* The debt is sold for a factor firm which is member of the same company group or not.

Possible code values: 0: False,

1: True.

Type of cut-off The reason behind striking out the deal that result in expiration of the bank’s claim on the client.

Possible code values:

1: Auction of the real estate, collective selling, 2: Factoring (selling of the debt).

Date of cut-off Date of striking out the deal and the expiration of the bank’s claim on the client. Written-off principal

amount

The amount of written-off principal which is booked as a loss by the bank, given in domestic currency (HUF).

Written-off interest

amount The amount of written-off interest which is booked as a loss by the bank, given in domestic currency (HUF). Written-off other

claim

The amount of written-off late interest, fee, commission and other claim which is booked as a loss by the bank, given in domestic currency (HUF).

*: Filling in is compulsory only for factoring. (Self-made table) **: Filling in is not compulsory.

The Database does not contain client-related data and does not enable to link the deals of a particular client with each other. In principle this is not necessary for household exposures, since the Basel regulation allows the treatment on client level (Hkr. 68. § (1)

paragraph), however, managing the so called “cross-default” event attention has to be

taken in the course of model building for estimating the LGD, since when a loan becomes defaulted than the other deals of the particular client will carry higher risk as well. This problem has to be treated in the course of attaching default status to deals in the framework of the internal processes of the bank.