Instructions For Schedule Rc-L (Form Ffiec 031 And 041) - Derivatives And Pff-Balance Sheet Items Page 15
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18FFIEC 031 and 041
RC-L – DERIVATIVES AND OFF-BALANCE SHEET
Item No.
Caption and Instructions
The buyer of an option contract has, for compensation (such as a fee or premium),
12.d
(cont.)
acquired the right (or option) to sell to, or purchase from, another party some financial
instrument or commodity at a stated price on a specified future date. The seller of the
contract has, for such compensation, become obligated to purchase or sell the financial
instrument or commodity at the option of the buyer of the contract. A put option contract
obligates the seller of the contract to purchase some financial instrument or commodity at the
option of the buyer of the contract. A call option contract obligates the seller of the contract to
some financial instrument or commodity at the option of the buyer of the contract.
In addition, swaptions, i.e., options to enter into a swap contract, and contracts known as
caps, floors, collars, and corridors should be reported as options.
Commitments to lend that meet the definition of a derivative and must be accounted for
in accordance with FASB Statement No. 133 are considered options for purposes of
Schedule RC-L, item 12. All other commitments to lend should be reported in
Schedule RC-L, item 1.
Written options . Report in this item the aggregate par value of the financial instruments or
12.d.(1)
commodities that the reporting bank has, for compensation (such as a fee or premium),
obligated itself to either purchase or sell under OTC option contracts that are outstanding as
of the report date. Also report an aggregate notional amount for written caps, floors, and
swaptions and for the written portion of collars and corridors.
Column A, Written OTC Interest Rate Options: Interest rate options include options to
purchase and sell interest-bearing financial instruments and whose predominant risk
characteristic is interest rate risk as well as contracts known as caps, floors, collars, corridors,
and swaptions. Include in this item the notional principal amount for interest
rate caps and floors that the reporting bank sells. For interest rate collars and corridors,
report a notional amount for the written portion of the contract in Schedule RC-L,
item 12.d.(1), column A, and for the purchased portion of the contract in Schedule RC-L,
item 12.d.(2), column A.
Column B, Written OTC Foreign Exchange Options: A written currency option contract
conveys the obligation to exchange two different currencies at a specified exchange rate.
Report in this item the gross amount (stated in U.S. dollars) of foreign (non-U.S.) currency
and U.S. dollar exchange that the reporting bank has, for compensation, obligated itself to
either purchase or sell under OTC option contracts whose predominant risk characteristic is
foreign exchange risk.
Column C, Written OTC Equity Derivative Options: Report the contract amount for those
OTC option contracts where the reporting bank has obligated itself, for compensation, to
purchase or sell an equity instrument or equity index.
Column D, Written OTC Commodity and Other OTC Options: Report the contract amount for
those OTC option contracts where the reporting bank has obligated itself, for compensation,
to purchase or sell a commodity or product. Include any other written, OTC option that is not
reportable as an interest rate, foreign exchange, or equity derivative contract in column A, B,
or C.
FFIEC 031 and 041
RC-L-15
RC-L – DERIVATIVES AND OFF-BALANCE SHEET
(3-02)
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